June 8, 2016
It is telling that one of the first issues to be addressed by incoming London Mayor Saddiq Khan is the problem the capital’s thriving startups have in simply finding a place to work. Although the measures outlined in the new London Plan are aimed primarily at addressing London’s housing crisis, they also include measures to deal with the reduction in the amount of viable office space available following the relaxation of planning rules which allow developers to more easily switch existing office stock to residential use. The costs of office space in London is a growing concern for all sectors, but falls especially hard on startups. According to a recent study by SpareOffice, even the use of coworking space is an issue, with average monthly fees of £357 per person. Now the mayor has announced that he will put new measures in place to help protect and expand office space for small businesses, start-ups and entrepreneurs in London.
Sadiq Khan made the announcement following the publication of new City Hall figures which show that since 2013, over 1.47 million square metres of office space could have already been converted into residential units in London using the Government’s ‘permitted development rights’, which allows uncontrolled office-to-residential developments. This means space for nearly 94,000 jobs in London could be lost through this process.
The new measures the Mayor plans to put in place include:
- Amending the London Plan so that there is stronger protection for small businesses and start-up workspace
- Delivering new spaces for small businesses, the creative industries, artists and the fashion industry within new residential and mixed-use developments
- Promoting schemes to provide linked affordable housing and business space in new housing developments
- Working with the Government on changes to permitted development rights
In an announcement, the Mayor said:
“These new figures lay bare the impact that the Government’s misguided policies are having on space for business in London. Of course we need new homes, but this does not need to be at the expense of the space we need for the businesses that provide our jobs and drive our prosperity. Space which is genuinely surplus to commercial needs should be identified authoritatively and its release carefully managed so that it does not undermine local business. There clearly needs to be more control over where office space can be converted to residential use.”