30 August 2021/ rent_serviced_office_guide

Serviced offices – Pros and cons for large companies

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Serviced offices are becoming increasingly popular for businesses, big and small. These plug-in-and-go spaces were once the domain of start-ups and freelancers, but larger businesses are now beginning to see their appeal. But does a serviced office work well when you have 500-plus employees? Let’s weigh up the pros and cons.

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Benefits of serviced offices for large businesses

Nearly 47% of businesses said they expected to look for more flexible, serviced and co-working office space in 2021. Here are a few reasons why businesses are moving towards the serviced office world.

Purpose built

Only 8% of UK employees want to work from home five days a week. People want a change of scenery, to be around colleagues, and work in a space that’s fit for purpose. But if people are going to be lured from the comfort of home into the office, it needs to be a great place to work – which is why 36% of UK businesses say they plan to focus on creating a quality workspace in 2021.

Either built for purpose or designed for a purpose, serviced offices are often high-quality spaces with features that enhance working. For example, they can offer good soundproofing, ergonomic furniture, fast WiFi, plenty of natural light and good airflow. Given that air quality and comfortable light came out on top in an employee survey about key office features, these design aspects of an office shouldn’t be ignored.

Excellent facilities

In the same employee survey mentioned above, 16% said that access to fitness facilities was an important characteristic of an office. That may not sound like a high percentage, but if you have 1,000 employees, that’s 160 key people. In addition, serviced offices often come with excellent facilities, such as showers, a gym and bike storage. Having these facilities ready and available to use takes the pressure off a large company that wants to provide some of these wellness benefits.

Easy to manage

As well as having excellent facilities, all costs of a serviced office are usually built into one single, fixed fee. This kind of set-up makes serviced offices very easy to manage and budget for. You won’t need to worry about fluctuating costs of bills, as you’ll know exactly how much you need to pay each month. And the price you pay will include useful additions like a manned reception, refreshments, internet, cleaning bills and desks and chairs. They’re known as plug-in-and-go spaces because you don’t need to spend time fitting out your new space.

Top-rate locations

Given that serviced offices need to appeal to many businesses, they are often in prime locations. They could be in city centres or business hubs that offer excellent networking opportunities. Even large businesses that don’t want to lease an entire building can go down the serviced office route to get a footing in a top location.

Greater flexibility

Lots of businesses want more flexibility than ever before. In advanced economies, it’s predicted that between 20% and 25% of workers could work from home three to five days a week. Offering this kind of flexibility can be difficult for large businesses that do not want to spend overheads on space that is only used a few days a week. With a serviced office, you can often lease some desks full-time and give other members of your team access to hot-desking space shared with other businesses, which can bring down the cost of your contract.

Not only that, but you can benefit from a more flexible contract. You may only be tied in for a couple of years or a few months, and the contract may even become rolling month-by-month. For businesses uncertain about how their employees will want to work in the few years, this flexibility could be a big plus.

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Disadvantages of serviced offices for large businesses

Serviced offices are often well-suited to small businesses. Here are some reasons why this might not be the case for larger businesses.

They can be more expensive

The added benefits of ease, flexibility and top facilities can come at an additional cost. But actual costs widely vary based on location. For example, you can expect to pay around £500 per person per month for a serviced office in London, around £400 in Manchester and about £250 in Birmingham. These costs may be offset by the expense of hiring people to manage office space. However, for large businesses that already employ more than 500 people, the costs of an extra one or two employees may outweigh the additional expense of a serviced office.

Less opportunity to personalise

A serviced office will usually bring you the high-end style many large businesses want, but you may be limited in the amount you can do to the space. You should be able to create the layout that works for your team, but you might not be able to brand the space to reflect your company. However, some serviced spaces will enable you to do this, especially if you rent an entire floor or a large room within a building.

Collaboration could be limited

Now that UK workers have, generally speaking, seen the productivity benefits of working alone at home, many now regard the office as a place to collaborate. A survey revealed that 58% of businesses are looking for more collaborative space, which may be more difficult to achieve in a serviced office. Depending on the space itself, you may have to pay extra to use meeting rooms, and you might not have access to the kind of comfortable furniture and technology that fosters collaboration. Having said that, many serviced offices do provide these kinds of environments, so you may just need to shop around.

Serviced offices are evolving rapidly, and there is great diversity in the market. While some are geared towards start-ups, offering the basics and lots of flexibility, others are well-suited to large businesses looking for a smart and easy to manage office. And as how we utilise office space changes, we expect serviced offices to continually adapt. They may well be the leading choice for businesses both large and small in the near future.

To explore the serviced offices currently taking on new tenants, browse our directory.