There didn’t use to be many options for businesses caught with a gap between a lease ending and a new one starting. Similarly, if a business is looking to test expansion into a new market before committing to a traditional lease.
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But the growth of flexible workspace has taken away some of the stress by providing short-term space options. The problem is that it can feel like an unfamiliar landscape for businesses used to traditional offices and lease terms.
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Ollie Lee
020 3940 9463
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Understanding the options for short-term space
Bob Toor
020 3872 7121
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“Ours is a partnership built on the value of a good relationship with clients and an understanding of their specific business needs and demands in an ever-changing landscape”
Ollie Lee, Carter Jonas
Ollie Lee, Associate, Carter Jonas says: “Serviced offices offer a quick and flexible solution that is much more readily available now than it was 10-20 years ago, but while businesses are more aware of the concept, there are some common misconceptions.”
Carter Jonas has teamed up with flexible workspace brokerage portal Office Freedom to help occupiers navigate the options for short-term space. And the first hurdle is the label. Serviced offices, managed offices, and co-working space are all used to describe flexible offices, but there are differences in what each offers.
“Clients sometimes think of flexible offices in the co-working sense and that they will be hot-desking with multiple other businesses,” says Lee. “But that isn’t necessarily the case.”
Flexible workspace can include hot desks, fixed desks and exclusive access to an office or whole floor with a lockable door.
The flexible workspace concept isn’t new; Office Freedom is celebrating 30 years in the sector this year. It has evolved, expanded and become increasingly sophisticated, aligned to occupier trends.
Bob Toor, Senior Account Director, Office Freedom, says: “Operators have different offers more than just four walls, so it’s about understanding which suits best for our clients, what type of environment would be conducive for particular types of occupiers.
“The solution for a client might actually be having access to a combination of different styles of flexible workspace to meet different work patterns, particularly with hybrid working.”
There are also misconceptions about how short-term a deal within a flexible office operator can be. If you are looking to take a whole floor in a managed office, then 1-2 years is likely the minimum, but generally, three months is typical in a serviced office environment and in some instances, there are a few landlords who even offer a monthly rolling agreement.
“A client with 40 staff needed space for two months as a stop-gap before they moved into a new office they had leased,” says Toor. “A deal was negotiated in serviced space owned by a family-run business with a small portfolio.”
When a business vacates a traditional lease, there will be dilapidation costs, but regardless of the length of commitment, there is no such cost in a flexible workspace. And the space is ‘plug and play’, so there are no fit-out costs.
Bespoke space, such as having a dedicated meeting room attached to a self-contained office, will likely incur extra costs, but negotiating for landlord contributions isn’t impossible depending on the duration.
Carter Jonas and Office Freedom: the partnership
There is a perception that serviced or managed offices will cost them more because of the flexibility, but it isn’t necessarily the case.
“We’ve got the most comprehensive database of flex space that spans over 30 years and don’t leave any stone unturned.”
Bob Toor, Office Freedom
With a traditional lease, you need to factor in the capital expenditure, furniture costs, internet access and legal fees, among other things. Plus, the time taken from conception to occupation.
Indeed, deals can be negotiated and signed in a fraction of the time it would take for a traditional lease. Lee and Toor completed a deal for 3,300 sq ft in around four weeks.
Post the pandemic, flexible office options have expanded. For example, as businesses have rationalised office space on traditional leases, spare floors have been turned into managed offices providing more choice.
Operators are also responding to demand for a wider variety of workspaces with less traditional desks but more places for collaborative and group work and Zoom rooms for video calls.
Toor says the service office market is in a good place: “It's really picked up post-COVID. The West End is running at 90% occupancy, and the City at 85%. Landlords are looking at creating more space and acquiring more buildings.”
But in another difference from traditionally leased offices, it’s not just about whether an occupier can pay for the space. “We advise clients on the landlords – it’s not just the tenants' covenant anymore,” says Toor.
Carter Jonas and Office Freedom work as a team providing complimentary expertise, advice and continuity throughout the process of finding and negotiating on flexible workspace.
To find the right space, the team research options, comparing different offers using Office Freedom’s extensive database and market knowledge. This covers the familiar names, big brands, and smaller independent and bespoke flexible office operators.
“We’ve got the most comprehensive database of flex space that spans over 30 years and don’t leave any stone unturned,” says Toor.
The search and negotiation are free for the client, the fees come from landlords and operators, and there is transparency about those fees.
“Delivering the best deal and customer experience is important to both Carter Jonas and Office Freedom; ours is a partnership built on the value of a good relationship with clients and an understanding of their specific business needs and demands in an ever-changing landscape,” says Lee.
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ISSUE 03 | MAY 2023
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