The spread of the virus and efforts to contain it have turned one of the world's busiest urban high places into a virtual ghost town, driving millions of people out of the city center and its financial district, and suddenly disrupting the trade.
The scale of the closure would have been unimaginable just six months ago, when around 500,000 people traveled to the area around Piccadilly Circus for the annual New Years Parade and it was common to wait 90 minutes for a table in the most frequented restaurants.
Then the pandemic struck. Almost overnight, stores closed, tourists fled, offices and streets were emptied and the city's 9 million residents fled to their homes. Nowhere has the status quo been more sharply captured than in the pillar of London's urban life: the Tube.
Underground routes for the month of March fell 43% from the 106 million recorded in February, and plunged even more in April, at the height of the lockdown, at only 5.7 million. Social distancing rules mean that the metro can only handle up to 15% of its normal traffic, according to London mayor Sadiq Khan.
The fallout from the lockdown was severe. London's economy to contract by nearly 17% this year, city government figures show, stronger than the 14% drop the Bank of England expects for the UK as a whole .
London businesses are expected to cut some 460,000 jobs, or around 7% of the workforce, with manufacturing, construction, retail, accommodation and food services the most hard hit. Employment is not expected to fully recover until 2022.
With transportation severely limited and a potential coronavirus vaccine still months away, the people and businesses that have made London a real estate, financial, artistic, hotel and technology hub are desperately trying to reinvent themselves in the hope of surviving. the pandemic. .
A sign of progress: pubs, restaurants and hairdressers can reopen on Saturday, provided they respect the rules of social distancing.
The physical city
The significance of the pandemic for the large collection of London headquarters is not yet clear. Paul Cheshire, professor of economic geography at the London School of Economics, quickly rejects the suggestion that the office is dead as "nonsense", arguing that what will happen in the long term will be less dramatic.
More people will spend more time working from home or in decentralized offices, but that will not negate business demand for downtown locations, which have been shown to increase productivity and facilitate sharing of ideas, he said.
What happens to real estate, which accounts for 15% of London's economy, is very important to the city.
The government has protected commercial tenants from eviction until August, but these measures will expire at some point. According to the property management platform Re-Leased, only 45% of commercial rents in the third quarter had been paid in early July. But it was an improvement over the previous three months and "a sign of the capital's resilience," said Re-Leased CEO Tom Wallace.
The pandemic has accelerated existing trends around agile work and the desire for more flexible office space, where several different companies share meeting and social spaces, as well as facilities such as showers, bike racks and kitchens .
Businesses "want their offices to count," said Darren Richards, head of real estate at British Land, a leading British real estate company. He predicts that more old offices needing renovation will likely be marketed in the future, as companies prioritize better quality spaces.
British Land, which owns 7.1 million square feet of commercial buildings in areas like Broadgate, Paddington, Mayfair and Regent's Place, said that its tenants are not currently looking to get rid of the offices. Businesses "still fundamentally want space," even if they plan how much and for what purpose, said Richards.
However, the penetration of online shopping during the coronavirus will lead to a reduction in brick and mortar outlets, which could radically change the landscape of London's vast commercial space and create even more uncertainty for the property market. city. "What would have happened over five years is happening over several months," said Richards.
The city reinvented
London's financial heart, called the City of London, has a proven track record in reinvention.
Legendary institutions like Lloyd's of London, the Bank of England and the London Stock Exchange have existed for centuries, despite radical social, political and economic upheavals.
Today, the city is home to well over 250 international banks and manages 43% of global currency exchange, according to the Bank for International Settlements. Financial services contributed £ 65 billion ($ 81 billion) to the London economy in 2018, or about 15%, according to City Hall.
And despite four years of uncertainty over Brexit, the UK has been the first country in Europe to invest in international financial services in the past two decades, with London claiming the bulk of these flows.
"London's dominance as the main European financial center remains unmatched," said Omar Ali, managing partner of EY's financial services in the UK.
British financial services will continue to be a major beneficiary of foreign investment even after the pandemic, according to an EY survey conducted in April.
Investors have classified the availability of capital as the most important consideration influencing their future location choices, followed by the safety and security measures put in place to prevent a future major crisis, whether it concerns health, the environment or cybersecurity.
However, certain factors are detrimental to the City. The UK government's handling of the coronavirus crisis has been widely criticized and business and consumer confidence remains depressed.
"We did not take advantage of the fact that we are an island and did not progress quickly enough. There was a lot of complacency and pride," said Richard Burge, CEO of the Chamber of Commerce and Industry from London.
The government's approach to negotiating trade relations with the European Union after Brexit has also been criticized. A group of business leaders warned this week that Britain's decision not to extend the current transition period beyond the end of the year is a "huge gamble".
The city of London could still be tested. Above all, there is currently no guarantee that UK financial firms will retain access to the European Union after this year - an export market worth £ 26 billion ($ 32.4 billion). ) in 2018, according to the Office for National Statistics, i.e. 40% of the sector's growth. Total value.
Always good for startups
As London seeks to maintain its status as a leading global business center, the city's tech sector, which boomed following the global financial crisis, could help.
Google, Facebook and Amazon have large offices in London, and start-up investments continued during the pandemic, suggesting that losses in real estate and financial services could be offset in the technology sector. London-based start-ups have raised $ 4 billion in venture capital since the start of the year, more than Paris, Stockholm, Berlin and Tel Aviv combined, according to figures compiled in June by Tech Nation and Dealroom.
"It's a global arms race, but London is still ahead," said Brent Hoberman, co-founder of Founders Factory, an accelerator. "I think London remains absolutely a global magnet for technological talent," he added, attributing its appeal to world-class educational institutions, its diverse culture and the early successes of entrepreneurs.
The closures have only accelerated the adoption of digital technologies in everyday life and have boosted information technology and health businesses, building on London's strengths, said Suranga Chandratillake , a partner of Balderton Capital, one of the leading European early stage venture capitalists with interests in companies such as Citymapper, Vivino, Lyst and Revolut.
The city is home to a large share of digital consumer businesses, said Chandratillake, including online grocer Ocado, digital banks such as Revolut and Monzo, and food delivery companies such as Deliveroo and Gousto.
London also has a disproportionate share of tech companies in areas such as cybersecurity and workforce management, which now serve armies of homeworkers. And the coronavirus has spurred investments in health technologies, benefiting more widely in London and the United Kingdom.
"The city is the most genetically diverse in the world, almost all citizens use the same health system and there are a variety of technology projects, both funded by the government within the NHS. [National Health Service] and privately funded startups, which have grown rapidly in this context and are in a very strong position, "Chandratillake told CNN Business.
The pandemic could even help catalyze new ways of doing business. London & Partners, the London trade and investment organization, said it recently organized a trade mission through Zoom , where a group of human resource technology entrepreneurs presented their activities to investors and potential clients in New York.
"If we assume a reduction in travel, it points to naturally digital sectors in which London has strengths," said chief strategy and business officer Allen Simpson.
Saving London culture
As London's tech and financial sectors seem poised to weather the current crisis, social distancing and cut travel are devastating for its once thriving arts and culture scene, which helps attract tourists, aspiring young professionals and investments. For theaters, museums, restaurants and bars, it is an existential threat.
Leisure and hospitality "are of strategic importance," said Simpson. "People come from all over the world partly because London is a cool place to live."
Almost 40% of Londoners were born outside the UK, making London one of the most cosmopolitan cities in the world. It is home to 1 million EU nationals and was the third most visited city in the world in 2018, just behind Paris and Bangkok, according to Mastercard.
Last year, London had 21.7 million foreign visitors who spent £ 15.7 billion ($ 19.6 billion) on the local economy and supported 250,000 jobs, according to the Office for National Statistics .
"These revenues keep things in London," said UK Tourism Alliance director Kurt Janson. "West End theaters could not survive without foreign visitors."
In an open letter to government signed by the UK Theater and nearly 100 actors, writers and directors, the Society of London Theater expressed concern that "British theater is on the brink of ruin".
"Theaters do not have the money to operate sustainably with physical distance," they said. The industry called for an emergency relief fund, continued salary support and more help for the self-employed and self-employed artists.
London's iconic museums, galleries and tourist attractions are also at risk. Several have yet to announce their reopening, although they were allowed to do so on Saturday. In a joint statement released late last month, museum directors such as the Tate, the British Museum and the National Gallery said it was "how and when we can reopen our doors in a financially sustainable way. , long-term".
The National Gallery announced its reopening on July 8, while Tate Britain and Tate Modern will reopen on July 27 and the Tower of London on July 10.
Pubs and restaurants in London face an even greater threat of social distancing.
Already, Michelin-starred Texture and the upscale Indian Accent, a Mayfair outpost of the original Delhi, have closed down. They are unlikely to be the only victims.
Murat Kilic, the owner of Amber in trendy East Aldgate, told CNN Business that he was not confident it would reopen. Amber opened its doors on Saturday for the first time in almost four months, but at less than half of its previous capacity.
Kilic is concerned that when government assistance is cut in October, he risks being evicted unless the owner agrees to temporarily reduce monthly rents.
For Joseph Ryan, business should explode the weekend of July 4 in his two pubs in London. Howl at the Moon and The White Hart have far more bookings than usual, said Ryan, but is less optimistic about the longer-term outlook.
Interior capacity has been cut in half, seats are now mandatory, wooden signs have been erected between tables, and staff will wear masks and gloves.
"We are confident about this weekend, but afterwards we are not so sure," said Ryan. "The novelty may disappear."
It remains to be seen whether Londoners will quickly return to bars and restaurants. Worryingly, household incomes and spending are expected to drop 5.5% and 12% respectively this year, and are not expected to reach 2019 levels until at least 2023, according to the city hall.
The speed with which a new London emerges depends on the coronavirus: if cases continue to fall and social distancing is further reduced, the economic outlook will be brighter. A second wave could lead to further blockages and all the economic suffering that ensues.
London will find "workarounds" to the immediate challenges posed by the virus, said the London Chamber's Burge, to become a city of cyclists and walkers to stand outside the bars in the drizzle. "This is what we are doing," he said. "London will pass."
- Eoin McSweeney contributed to the report.