FT: What is the future for the high-rise office?

Date: 26 September 2001
Source: FT
Attitudes to skyscrapers may be changing after the attacks on the US, but companies need central locations for attracting staff and exchanging intelligence, says Michael Skapinker.

In the chaotic, dust-choked after math of last week's New York atrocity, one fleeing survivor screamed at a television camera that this was her second escape, that she had been in the World Trade Center when it was bombed in 1993.Many in the US and elsewhere hope that the twin towers will be rebuilt, that the murderers' supporters are not granted the victory of seeing empty city blocks turned into memorial parks.

It is an admirable response, recalling the resolution of Londoners and residents of other British cities who went back to work after IRA bombings and who repeatedly rebuilt shattered workplaces and shopping malls.

But the human toll of last week's attacks exceeds anything that has gone before. Who could blame those who would prefer not to return to a rebuilt World Trade Center - or who now have qualms about working in prominent skyscrapers anywhere?

The scale of last week's tragedy means it will be months before the consequences are thought through but already people are asking why we need such large workplaces and whether, in an age of wireless communication, it is necessary, or even desirable, to gather so many employees in one place.

The question of whether we still need offices has been asked persistently since the mobile phone, the laptop and the internet made it possible to work anywhere - on a train, in a cafe or on the kitchen table.

It is a question many believe has already been answered. The end of the office never happened. John Seely Brown and Paul Duguid noted in The Social Life of Information, published last year, that in 1998 the US office vacancy rate dropped to single digits for the first time since 1981, in spite of a huge increase in new building.

We are social animals. We like offices. We like the contact and the gossip. People work from home more than they used to but few do it every day. "If I stay away from the office too long I start to get twitchy," says Nigel Nicholson, professor of organisational behaviour at London Business School. Home working is lonely. Employers do not like it much either, Prof Nicholson says. Even in an age in which managers are encouraged to judge employees by their output rather than by the hours they spend in the office, few companies are comfortable managing staff they never see.

"A lot of traders could be at home in front of their terminals," Prof Nicholson says. "But there's a lot of casual interchange in an office. You've got the research guys near you. Home is quite a difficult place for traders. There's less of a framework. Even with electronic surveillance, banks would see risks if traders were out of their grasp."

Non-financial companies feel the same way. It is not only employers who worry about losing control of those who are away from the office. Employees worry about losing control too. People who are away from the workplace fear missing out on promotion or bonuses. "They think they are going to be overlooked. Out of sight, out of mind," Prof Nicholson says. Mr Seeley Brown and Mr Duguid add that the technical glitches that are an inescapable part of the digital workplace are far easier dealt with in an office, with a help desk, than at home.

But if people are going to remain in offices, why stay in city centres? Why not move the office to leafier suburbs, where rents are lower, the air is cleaner and people may feel safer? Some companies have already moved out of the biggest cities. The principal US office of UBS Warburg is in Stamford, Connecticut. GlaxoSmithKline has its head office in Greenford, Middlesex, on London's western fringe.

But companies have clustered together since the industrial revolution and they largely continue to do so. The inventors and entrepreneurs who created the technology that made remote working possible themselves clustered together in Silicon Valley. When financial services companies and corporate lawyers started moving out of the City of London, they moved east to the same place, Canary Wharf.

Companies prefer clusters because that is where they find the talent, the ideas and the industry intelligence. It is far easier to hire people who work down the road, who are known in the industry and do not have to move house than to recruit staff from hundreds of miles away. Once an industry gathers in one place, so do its financiers and support services.

For all the inconvenience, dirt and congestion of large cities, they remain excellent places for clusters. The most talented people are attracted by their excitement, their cultural amenities and their meritocracy. In cities such as New York and London it does not matter if you come from somewhere else: so does nearly everyone else.

Successful cities do not have to build upwards. London and Paris remained relatively low-rise centres as US office buildings rose to the skies. But cities that run out of space have little option but to build skyscrapers. They were the answer for the island of Manhattan and, until last week's attack, were seen as the salvation of the square mile of the City of London, threatened both by Canary Wharf and competing centres such as Frankfurt.

Ken Livingstone, London's mayor, said in May that London's commercial rents were the world's highest and the city would need higher-density buildings if it wanted to remain competitive. There are proposals for several new tall buildings, including a 66-floor structure, Europe's tallest, at London Bridge station. The proposed building's creator, the renowned Italian architect Renzo Piano, describes his design as being like a "shard of glass".

What are the chances now of new skyscrapers being built? "It's impossible at this stage to answer that," says Sir Stuart Lipton, chief executive of Stanhope, the property group, and chairman of the Commission for Architecture and the Built Environment, a UK government-funded body. But he says the economic arguments in favour of companies gathering their employees in one building rather than dispersing them remain strong. Single sites cut costs, he says, allowing companies to avoid duplicating services such as security and catering.

Gail Fenske, a US writer on the history of skyscrapers and professor of architecture at Roger Williams University in Rhode Island, believes, however, that last week's attacks could change the economics of tall buildings. The principal challenge of modern companies is attracting staff and if people insist on working in smaller, less prominent premises, companies will have to accommodate them.

Lower-rise buildings can still be targets: the Pentagon was also attacked. But while there was tragic loss of life there too, the numbers were far smaller. A collapsing tall building causes far more destruction.

For those whose companies remain in city centres and large buildings, life will change. London responded to two IRA bombs in the City in the 1990s with increased security. There are closed circuit television cameras on every street. Traffic entering the City is carefully monitored.

Greater safety means increased inconvenience and intrusion, whether at work or when boarding an aircraft. Airline travellers in the US are likely to get a taste of what passengers on El Al have experienced for years: luggage minutely searched, toothpaste tubes squeezed, personal questions asked.

There is, however, no complete security against those who are prepared to kill themselves in carrying out their atrocities. People will attempt to return to normality this week. Those who work in skyscrapers will take their lifts to the usual floor. They will worry about their safety. As long as terrorists remain active, a city that has been attacked never entirely returns to normal. But at times of anger, grief and fear, the need to be with familiar faces becomes stronger than ever.

600450 FT: What is the future for the high-rise office? glassonweb.com
Date: 26 September 2001
Source: FT

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