57 percent of C-Suite Execs in London confirm they are prepared to pay a premium for better digital connectivity in the office
62 percent of London residents aged 30 and under would expect a discount on their rent if broadband speeds and mobile coverage were unsatisfactory
Connectivity is more than just broadband speeds and 4G coverage. New research from property consultancy Cluttons has revealed the impact it has on everything from the properties we choose to live in, to the places where we can work and our overall happiness both at home and in the office. The research highlights how London is lagging behind other national and global hubs when it comes to good connectivity in both residential and commercial properties, failing our needs both as residents and businesses.
The research, carried out in partnership with YouGov, investigated resident and landlord attitudes in London to connectivity and identified the impact that our culture of ‘always-on’ flexible working has had to our attitude towards connectivity. London currently ranks 30 out of 63 UK cities for the number of premises covered by ultrafast broadband, and is positioned in the bottom five UK cities for 4G coverage, and London residents are demanding more. In fact, 73 percent of residential tenants state that good connectivity is an important consideration when choosing a property to rent, and 70 percent of those who work from home at least one day a week say that they would be likely to reconsider renewing their current contract if they were not satisfied with the connectivity in their homes. Nearly 60 percent of those surveyed would expect some discount in rent as compensation for poor connectivity, and close to 1 in 5 would request a 10% decrease.
John Gravett, Head of Infrastructure at Cluttons commented: “As London’s property market becomes more competitive, it is important for landlords to think of their tenants as customers and offer them properties that meet current demand. While traditionally it would fall to tenants to find the best offering from broadband service providers, now landlords are realising how important it is to make sure their buildings are well connected. As a result of this, our research found that half (49 percent) of landlords are already working to improve connectivity in their buildings and of those 72 percent say this is as a direct result of tenant demand.”
While residential tenants wouldn’t expect to pay more for good connectivity, Cluttons’ research identified that good digital connectivity in commercial London properties is worth up to an additional £4.17 per square foot (for properties in the West End, with the average London commercial property being 15,000 square foot). At C-Suite level, 57 percent of respondents said they would be prepared to pay more for better digital connectivity in the office, showing that connectivity is now a boardroom conversation, not just an employee gripe. Both employees and decision-makers also rank connectivity as the fourth most essential consideration after location, rental cost and transport links when choosing a new property, putting it above relocation costs, staff amenities, and the flexibility of a space. What’s more, 81 percent believe that employees are more satisfied in their roles when an office is well connected, with 85 percent saying strong connectivity within an office should be a standard offering and 79 percent stating that offices that are well connected are better performing businesses.
Gravett continues: “Good connectivity has knock-on effects to many aspects of our lives, from how we communicate with each other to maintaining flexibility and therefore diversity in the UK’s workforce. Despite this, the British capital not only lags behind other UK cities, but it also ranks poorly compared to other European hubs as well. In fact, London ranks 29th out of 30 EU cities last year for 4G speeds.
“It is increasingly important for landlords to consider the connectivity of a building to attract tenants, help businesses perform better, boost staff morale and ultimately, ensure that London is not left lagging behind other UK and global hubs. 5G is just around the corner, so it’s an exciting time to watch how London is adapting to ensure its buildings are fit for great connectivity going forward. We believe connectivity is now a utility, not just a nice to have, and our research clearly shows that there is a commercial benefit to both commercial and residential landlords in prioritising it as such.”