The coronavirus pandemic has increased the demand for business premises – Helsinki city centre attracts cutting-edge businesses
The remote work boom transformed the role of business premises, and now companies are competing for high-quality premises in top locations. The fiercest demand focuses around Helsinki city centre, which can provide companies with the best services and public transport connections in Finland.
As remote work increased during the coronavirus pandemic, questions about the future of business premises were also raised. Coronavirus restrictions also cut business travel and tourist flows, which led to concern if commerce in urban centres, and Helsinki city centre in particular, would slow down.
Janne Prokkola, Head of Unit at the southern unit of the City of Helsinki’s City Planning Department, views the development of Helsinki city centre from a wider perspective.
The most significant hub for innovation and jobs in Finland is an astonishingly small area.
“Capitals and their centres are always the best at overcoming crises. They can transform in times of flux but in the long run, their attractiveness is always on the increase,” says Prokkola.
The expert views the record-breaking demand for business premises in the city centre as a driver that will expedite the recovery from the coronavirus and accelerate the growth in the city centre’s vitality.
“Even though remote work is here to stay, hybrid work and the increased efficiency of space utilisation attract an increasing amount of foot traffic in the city centre. Simultaneously, the retail transformation and longing for a sense of community are creating new kinds of services and communities in the city centre, which may increase the area’s attractiveness even further.”
Unique urban culture
The most significant hub for business and jobs in Finland is an astonishingly small area. Helsinki city centre is an approximately two-square-kilometre area around the main railway station. Nearly half of all office jobs in the Helsinki Metropolitan Area are located within this area.
In the city centre’s companies, high productivity and competence go hand in hand.
According to Prokkola, the secret of the city centre’s vitality is the diversity of the people who use the area.
“In addition to its inhabitants, many tourists, students, shoppers, and people working elsewhere move around the area, creating a unique and constantly evolving urban culture.”
According to studies, the number of both cutting-edge businesses and tolerant, highly-educated people is at its highest in Helsinki city centre. The area also attracts international companies and investors.
Indeed, according to Prokkola, Helsinki city centre should be compared to other Nordic capitals instead of other Finnish business districts.
All national discussions and lobbying take place in the heart of the city.
“The factors that set Helsinki city centre apart, even in international comparison, are its competitiveness, safety and proximity to nature. The city centre is characterised not only by its global nature but also by the ease and smoothness of everyday life.”
Continuously developing city centre
The theme of Helsinki’s new strategy is A Place of Growth. The aim is to develop the city and its centre into an even more vibrant and safer place while respecting local nature and Helsinki’s cultural heritage.
The most significant development projects in the city centre are the redevelopment of Elielinaukio Square and South Harbour’s Makasiiniranta. An international architecture competition has been organised for both of them, and the finalists will be presented to the people of Helsinki during 2022.
The city centre is also expanding further out as Vallila is witnessing the development of the communal business and cultural hub Train Factory, and the aim is to create a high-profile business hub with brick-and-mortar services in Hietalahdenranta, at the end of Bulevardi.
“The pedestrian city centre project is still part of the city’s strategy. Walkability increases the city centre’s appeal and attractiveness and, contrary to what people often think, public transport users spend more money than motorists,” says Prokkola.
According to Prokkola, the aim of the city centre development plans is to invest strongly in functions that support businesses, such as retail properties, offices, and services.
The best services and public transport connections
One factor that attracts businesses to the area is the best service selection in the country.
“The city centre provides shopping, entertainment, culture, and restaurant services of international calibre. The area also features an exceptional number of specialty stores, large shopping centres and traditional department stores,” explains Prokkola.
Thanks to its diverse services and vivid business life, the city centre has particularly strong economies of agglomeration as small and large commercial operators and businesses support one another.
“All national discussions and lobbying take place in the heart of the city,” summarises Prokkola.
People gather at the Market Square when something significant happens.
Helsinki city centre is a national, internationally connected public transport hub, which means that the location also provides companies with the best public transport connections in Finland. The Crown Bridges Light Rail project to be completed in 2026 and the Jokeri Light Rail will only improve the accessibility of the city centre.
Firmly number one
Although new growth centres and business districts have emerged around the city centre in recent years, Prokkola doesn’t think that any of them can compete with the city centre’s status.
“People gather at the Market Square when something significant happens. Helsinki has only one centre, and it’s constantly developing and becoming more diverse.”
Prokkola emphasises that the city centre’s purchasing power consists of all the city’s inhabitants as people also come to the centre for reasons other than shopping or working.
“The uniqueness and attractiveness of the city centre are based on its diverse offering, high-quality operating environment, and public spaces and events that are open to all,” he summarises.
LOCATION IN THE CITY CENTRE IS A COMPETITIVE ADVANTAGE
According to Tero Lehtonen, CEO of the international real estate advisory company JLL Finland, the coronavirus pandemic has significantly transformed companies’ needs for business premises.
“Offices are increasingly becoming locations for encounters and businesses’ calling cards for customers and potential employees. In addition to being their own premises, customers look for high technical quality in buildings as well as attractive common areas,” defines Lehtonen.
The significance of location and sustainability have also increased. Offices must be easily accessible from all directions and surrounded by extensive services, and the premises must support the company’s ESG goals. Growing brand value can also be an incentive for choosing a prime location.
“All these wishes come true in Helsinki city centre where the demand for class A business premises is almost record-breaking. It’s fairly difficult to find a high-quality office covering over 1,000 square metres across one floor.”
The city centre attracts competence-intensive businesses
“Most companies fall into the competence-intensive category, in which high productivity and competence go hand in hand. In this area, you can find companies operating in the legal and financial sectors, for instance, and nowadays also many IT, consultancy, and gaming companies,” lists Harri Autio, Director of Office Leasing at Sponda.
As a property developer, Sponda believes it is important to ensure that historical buildings in the city centre keep up with the passage of time. Protected premium properties are renovated respecting their history and, whenever possible, bicycle parking areas, employee facilities, and recharging stations for electric cars are also built in the properties.
Business premises are growing into ecosystems
In the post-coronavirus era, Sponda’s property development is guided even more strongly by the ecosystem approach. The aim is to choose street-level stores, services, and restaurants that also meet the needs of business premises customers. This leads to a win-win situation – customers enjoy a more extensive service offering and the cash flow in the street-level stores increases.
“As we own dozens of premium properties and two shopping centres in the city centre, we have a strong impact on the daily lives of visitors and the companies operating in the area. We develop our properties continuously and contribute to a lively urban culture by organising open events and supporting projects that increase the attractiveness of the city centre, among other things,” says Autio.
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