Lord Alan Sugar has said his central London property investments are “suffering” due to office workers staying home and City-based companies finding out they “don’t need” pre-pandemic size premises.
The billionaire is a long-term investor in prime City property through real estate venture Amsprop. The vehicle was behind the redevelopment of The Crosspoint near Liverpool Street Station, and its portfolio includes The Lever Building near Barbican.
The Apprentice star told the Standard: “As a landlord, we are suffering with our tenants struggling to justify the premises that they occupy.
“We are trying to be mutually reasonable with them and help them out with any kind of payment plans that they can have.
“A lot of companies, big companies in the City, to be perfectly blunt about it, have found out that they don’t need these premises because they’ve been doing business with their employees sitting at home on their computers. Particularly the City boys, they’re doing transactions – buying, selling, dealing, all of that stuff – and it’s suddenly dawned upon them that business is just as good, but actually we are paying massive rents for premises which really we don’t need.”
Lord Sugar said the City is already starting to see “consequences” of that realisation.
The entrepreneur added that he believes some finance companies have “taken advantage of the Covid-19 situation and are using it as a bit of an excuse” for cost-saving layoffs.
He added: “Some finance companies are not losing out [due to Covid-19] but they are finding out they don’t need the people, and they are taking advantage and using Covid as an excuse.”
Britain has seen far fewer staff return to offices than other major European cities, and large employers, such as NatWest and RBS, have told employees to expect to be working from home until 2021.
The businessman said he believes current criticism of the Government’s handling of the pandemic and the economy is a “little unfair” as they are “stuck between a rock and a hard place” as a result of an unprecedented pandemic, and praised the furlough and business loan schemes offered by Chancellor Rishi Sunak.