A serviced office space is a cost-effective, practical and flexible property solution that is proving increasingly popular with a variety of business types across the globe. Finding a traditional office lease can be a complex, time consuming and costly task. Serviced offices enable businesses to establish a presence in any city quickly and with nominal upfront costs. The serviced office market is one of the fastest growing in the property sector today. A serviced office is a ready-to-use office that is rented by the occupier on a pay-as-you-go basis - with virtual offices being on a month-to-month basis and executive offices being on a 3 or 6 or 12 month basis.
Our serviced office building is managed by our team of friendly professionals and is typically split into a number of floors or offices that are rented by multiple business tenants. Occupiers get access to the facilities required to run a business successfully, including reception support, access to meeting rooms, kitchen and breakout areas, printing services, and cleaning services
Unlike a traditional office where the tenant signs a "lease", the occupier of a serviced office signs an "agreement". Agreements are simpler, shorter and there's often more room for negotiation. There are usually no hidden costs, which makes it easier to budget.
Unlike a traditional office, agreements are flexible, allowing you to upsize, downsize or move out at relatively short notice. Short tenancies are ideal for company owners who want to minimise risk or those who are looking for a strategic move during lease negotiations.
The floor plan of our serviced office building is made up of all of the following:
- Private partitioned offices for small to medium sized enterprises (SMEs)
- Meeting rooms and boardrooms
- Shared kitchen area
- High speed internet
- Remote telephony
- Printing facilities
- A rooftop restaurant
Time Versus Cost
If managed efficiently, moving into a serviced office can be a speedy experience. A serviced executive office workspace will be fitted and furnished prior to you moving in, and IT infrastructure should be in place on your first day, enabling you to get to work straight away.
Depending on when the previous tenants move out and other factors such as cleaning and maintenance, you could potentially move in just days after signing the agreement. Leased offices on the other hand can take much longer to find, fit out and furnish. The whole process can take many months.
Autonomy versus Usability
A good serviced office is a well-oiled machine; desks, Wi-Fi and storage space are all in order and the building manager is on hand to solve any issues. Serviced office operators, i.e. the companies that run serviced spaces, are experts in the field and know what works and what doesn't. Because they have to appeal to a wide range of businesses while maintaining their own brand identity, a serviced office will usually have a uniform interior design running throughout. That said, you might be able to negotiate different furnishings or decor with your operator.
Flexibility versus Commitment
You can rent a workspace in a serviced office space for a matter of months. It's common to have a 1-3 month notice period, which significantly minimises the risk of you having to pay for an office you don't need. However, bear in mind that this means the operator can also ask you to leave at short notice.
A lease requires more commitment and is for a fixed period of time (usually three to five years), which is why it's important to be able to accurately forecast your growth. A commercial property lease typically finishes on its end date unless you include a clause to end it earlier.
Which Business Types use Serviced Offices?
A decade or so ago serviced offices were the domain of small businesses and startups. Following the global recession in the noughties, smaller businesses were drawn to the flexibility of serviced offices. More recently, large corporations have started using them too.
Serviced offices are also sometimes used as a temporary workspace by brands waiting for their office lease to be ready for them to move into.
Global businesses or those looking to expand to new markets can minimise their risk by opting for serviced locations. Some serviced office operators manage multiple locations globally, so it's possible to stay with the same brand.
In the face of uncertainty, it can be difficult for even large established companies to predict profit margins, and the flexible nature of serviced offices is what makes them an attractive solution.
Furthermore, as remote working becomes the norm, many companies no longer require a permanent office space for their team. Serviced offices can accommodate fluctuating a workforce more easily than a lease.
Serviced workspaces provide small to medium sized enterprises with access to the same facilities and opportunities as their larger competitors, such as access to meeting rooms, the use of business technology and the chance to source new business through networking. But as these facilities are shared with other occupiers, they don't have to pay for them upfront.
It can be tricky for startups to predict where they'll be from one month to the next. A flexible solution makes sense for new businesses that want to minimise risk, have access to business services and be in a place that encourages networking and collaboration.
Pros and Cons of Using a Serviced Office
As popular as they are, serviced offices aren't going to be suitable for every business and there are other options out there that might be more convenient, such as a virtual office, managed solution or, indeed, a lease.
Here's an overview of the main pros and cons associated with renting flexibly, designed to help you decide whether or not a serviced office is right for you.
Pros of Using a Serviced Office:
Here are a few of the benefits of using a serviced office space.
Minimal upfront costs
A serviced office deposit usually equates to one or two months' rent, if rented for longer than three months. As previously mentioned, serviced workspaces are furnished and fitted prior to move in, so you don't need to worry about buying desks or installing internet.
Ready to move into
You and your team should be able to hit the ground running as soon as you move in.
Building and community managers handle everything from cleaning to ordering tea and coffee, leaving you to focus solely on the success of your business.
Short term contracts
Serviced offices provide business owners with the breathing space to figure out a long-term property strategy. For others, a rolling contract makes perfect sense as their workforce is likely to fluctuate or they want to keep their options open.
One of the biggest draws is the access to facilities and services you might not be able to afford on your own, such as the use of high quality printers to state-of-the-art Audio-Visual technology.
Serviced offices are professionally presented and maintained which can help you to create a good impression on the clients you invite to the space.
One benefit that sometimes gets overlooked is the opportunity to connect with others. And not just the other businesses that occupy the same building - visitors, guest speakers, suppliers... the opportunities for forging new partnerships can be endless in a serviced workspace.
Cons of Using a Serviced Office:
If you require a completely bespoke office solution, a serviced office might not tick all the boxes. Due to their flexibility, serviced offices need to be able to accommodate new tenants quickly, therefore their design needs to be fairly generic and suit all tastes.
Less long-term security
Licence agreements provide less long-term security than leases. Therefore, serviced office operators could ask you to leave or move you to another part of the building at short notice. (Although as long as you're a good occupier this is unlikely: the serviced office market is becoming increasingly competitive and operators need a good reputation to compete.)
While sharing facilities and communal areas is beneficial when it comes to socialising and networking, it's not for everyone. If you don't want to share a kitchen or a breakout space, serviced offices might not be the best option.
That said, you can always opt for a managed office, which is a sort of middle ground between a serviced office and a lease. With a managed office, you benefit from flexible terms while having control over the design and fit out.
Serviced office brokers have a good understanding of the industry and can help you compare options in your chosen location. They will also schedule viewings for you and may also be able to negotiate contractual terms on your behalf.
Whichever way you decide to search, it's important to consider the following aspects. If you do decide to use a free office broker, they will ask you to outline your basic requirements in relation to each of these points. Visit our blog for more tips on renting an office space.
Your address says a lot about your business and can have a significant impact on client perception. Ideally, you'll want an office in a prestigious location, such as a city centre, that's easy for both customers and employees to get to.
It seems obvious, but you'll need to figure how roughly how much you're willing to spend because your budget could determine where you can afford to rent. The cost will also depend on which services are included.
- Services included
Think about what you actually need from your office space. Lean startups might only need the minimum, such as a receptionist and access to meeting rooms.
On the other hand, businesses looking to attract talent might want to rent a serviced office with all mod cons, including:
- Concierge services e.g. transport and catering
- Social and networking events
- Wellbeing initiatives and yoga
- Thought leader-led sessions
If you've decided to go through with renting an office space, check out our blog posts on how to prepare for renting an office.