How the pandemic and home working has affected Sunderland's business centres
Council chiefs have revealed how business centres have been impacted during Covid-19 – but predict occupancy will bounce back to pre-pandemic levels.
Sunderland City Council has three business centres which are managed in-house by a dedicated team, which is part of the council’s BusinessInvestment Team.
This includes the Evolve Business Centre, Sunderland Software Centre and Washington Business Centre.
At a recent meeting of the council’s Economic Prosperity Scrutiny Committee at City Hall, councillors received an update on occupancy rates at the centres in recent months.
A common theme included changing working practices during the pandemic, including home and hybrid working.
Of the three business centres, Evolve Business Centre was the most impacted from a financial perspective and lost more businesses to either full-time home working, ‘virtual tenancies’ or firms going into administration.
According to council data, occupancy levels reduced from 98% at the end of the financial year 2019/20 down to 69% at the end of October 2021.
However, council officers predict that the Evolve Business Centre will get back to pre-Covid levels by the end of 2022/23.
Sunderland Software Centre also suffered financially during the pandemic with many businesses working from home, or choosing to switch to virtual tenancies.
It also lost one of its anchor tenants, which previously rented 20% of the overall centre accommodation, with the centre’s total occupancy reducing from 71% at the end of the financial year 2019/20 down to 34% at the end of October 2021.
Although the future position remains uncertain, it is anticipated that occupancy levels will return to, or exceed, pre-Covid levels by the end of the financial year 2022/23.
This recovery will be helped by new tenant, the Department for Work and Pensions (DWP), which is set to operate a temporary Jobcentre at the site.
Out of the three business centres, had been the least adversely impacted financially – which council officers put down to the diversity of accommodation on offer.
This includes workshops and hybrid spaces, as well as offices, which separates it from the other centres.
Occupancy at the Washington centre was at 68% at the end of the financial year 2019/20 and 64% at the end of October.
Despite the impacts of the Covid-19 pandemic, council chiefs are confident they have steps in place to attract businesses to the three city sites.
This includes Sunderland Software Centre positioning Sunderland as a “centre of innovation and key location for software and technology businesses,” with links to Sunderland’s Smart City Strategy.
A council report prepared for the Economic Prosperity Scrutiny Committee added: “The ongoing improvement programme, including enhanced marketing through dedicated websites, is designed to raise awareness of the centres and what they have to offer.
“This should increase enquiries, and resultant lettings, therefore improving the financial position across all three business centres.
“As we seek to kickstart the local economy in a post-pandemic context, our business centres are importantly positioned to provide the capacity and resources to support local business growth.
“There is a real opportunity to maximise improved staff resources within the new team structure to increase business occupancy and growth.
“The business centres have historically provided significant economic value to the city and can continue to do so as they adapt to the new and emerging requirements of businesses and employees.”