Offices to homes: The quandary facing London’s second city

London’s Canary Wharf is shifting its focus from office buildings to residential. That may have seemed like a foregone conclusion after Covid, but according to reports in the Telegraph the wharf’s local council – Tower Hamlets – is reluctant to give developers free rein. Identifying Canary Wharf as a key financial district in its local plan, the council doesn’t want the area to turn completely residential. There would be a council tax benefit, but having ”London’s second city” in your borough also attracts the attention of commercial investors. Around a sixth of the wharf’s office space is currently empty. Developers are selling off space on the cheap as high profile tenants including HSBC leave for smaller offices in the older parts of London, more suitable for the modern hybrid worker cheekily dubbed TWaTs (for those in the office on Tuesdays, Wednesdays and Thursdays). But it’s not over yet. Last November, Revolut pondered a move to the very centre of Canary Wharf. Citigroup has committed to staying too, and as packed weekday tube trains hint, there’s still a hunger for the middle-of-the-week workspace.

Ian Jacobs, a scion of the Reichmann family that pioneered Canary Wharf’s development, is now hoping downtown San Francisco office space shows similar resilience.

The WSJ reports he’s planning to spend up to $900 million on buildings vacated since the pandemic and now for sale for 70 per cent less than what it would cost to build them from scratch.