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However you look at it, the City of London is currently a ghost of its former self. Many have attempted to downplay the impact the past 18 months have had on the Square Mile; the extent to which COVID-19 triggered a mass exodus from major UK cities may not have been quite as monumental as some had predicted. Even so, there is an eerie stillness and quietness in key corners of London that paints a picture of a new era dawning.
The latest estimates suggest that pre-pandemic levels and overall footfall in London is down by 65%. There are significantly fewer foreign tourists in the city than at any time in recent years, and the number of commuters has plummeted like never before.
Perhaps most importantly, figures indicate that as many as 3 million people relocated from big cities across the UK during the course of the crisis.
This mass migration of sorts has had a major impact on real estate markets across the country; for the first time in almost 20 years, around half of all property purchases valued in excess of £1 million took place outside greater London.
Up and down the UK, individuals with extensive investible assets are turning their attention away from London, while indicating their intent to support other local communities. Some studies suggest that more than 40% of investors plan on supporting local entrepreneurs or businesses within the next year.
Community focused investment is on the rise as is the prevalence of new business start-ups; while big business ground to a halt last year, official figures indicate that more than 800,000 new businesses were started by entrepreneurs in 2020. Wealthy individuals and city workers have found themselves freed from the shackles of their former professional lifestyles, free to set their sights on new parts of the UK and support local businesses.
Ultimately, an entirely new investor classification has been born; one where putting something back into the local community is a top priority.
The significance of this cannot be overstated, given how approximately 99.9% of private sector businesses fall within the SME or entrepreneur categories. In addition, these smaller businesses are responsible for employing as much as a 60% of the UK’s collective workforce.
Many communities were decimated both financially and socially by the events of the past 18 months. Thankfully, some of these communities could soon find their economies being propped up by conscientious investors, no longer tied to their desks in the City of London and seeking sanctuary in more desirable corners of the country.
