The hidden returns from providing affordable space

COMMENT There has rightly been an increased focus on placemaking in recent years, with an emphasis typically on elements such as public realm and sustainability. It’s clear that developers have a large part to play in building communities around their assets – and that in order to enhance and protect a property’s value, placemaking should form part of a long-term strategy from the outset. For landlords, it should be about more than creating a place – providing a sense of community for employees, residents and visitors. As one of the earlier adopters of a placemaking strategy, British Land has learnt that providing affordable space to local organisations can be a vital means of ensuring the success of a development, and that it becomes an integral part of its local community. In the same way that neighbourhoods consist of a mix of uses, affordable space can provide a range of functions too – whether it’s workspace, retail, cultural or event space. And that, in turn, feeds into creating a real sense of place, which brings countless mutual benefits to both the landlord and local communities. Offering affordable space to a broad range of local organisations generates huge social value while also attracting diverse businesses and people. This has a ripple effect resulting in more inclusive communities. Progressive landlords Providing affordable space is one of the most effective ways landlords can support social sustainability, which has never been higher on the ESG agenda and is valued by a broad range of stakeholders. Customers investigate our ESG performance when considering taking space at our places, investors scrutinise our approach, and our ability to attract and retain the best talent is intrinsically linked to what type of a business we are in terms of social and environmental responsibility. We know from experience that there’s no one-size-fits-all in terms of an affordable leasing strategy. Our asset managers focus on a specific approach for each distinct place, recognising their individual merits and diverse local communities. Our strategy is to apply a place-based approach to social contribution which allows us to understand the key local opportunities and challenges at each of our places and direct our efforts to create maximum impact. As a result, we can bring in a wide range of organisations – cultural, educational and employment, alongside start-ups in affordable workspace and retail. We have seen first hand the lasting relationships that can be forged through supporting a business at an early stage in its lifecycle, with many choosing to stay with a progressive landlord as they outgrow their affordable premises. We have seen start-ups take space at Storey, our flexible workspace brand, and subsequently expand into more permanent offices across our portfolio. Similarly, at Canada Water, we partner with Thrive to provide affordable workspace and support for local entrepreneurs, thus growing a pipeline for future opportunities at this major regeneration scheme which should stand it in good stead as it builds out. The availability of high-quality, affordable workspace is an issue for many start-ups, particularly in central London. It can prevent them from getting off the ground, leave them isolated working at home, or drive them away from London and its associated benefits. By providing affordable workspace, landlords can deliver a much-needed resource, while creating an ecosystem of connectivity with neighbouring businesses and tapping into local employees and customers. Think creatively Clearly a primary responsibility of a REIT is to generate the highest income possible for its shareholders, but often, by combining different kinds of customers in our places, we can deliver the greatest rewards for an asset, enhancing its overall value and appeal for the long-term. As developers and landlords, we have an exciting opportunity to think even more creatively and ambitiously about affordable space, from permanent uses to temporary meanwhile projects. The potential benefits – for us and society – are massive. David Walker is chief operating officer at British Land