2 July 2019/ rent_serviced_office_guide

Should you lease an office or go down the co-working route?

The pros and cons of the hot office trend

 

It's official: You're launching or growing your business and the kitchen table workspace just isn't going to cut it. It's time to look for an office space. But what are your options? Do you go down the traditional leasing route, or opt for a co-working set-up?

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Co-working spaces emerged about a decade ago, offering entrepreneurs, remote employees and freelancers an alternative place to work other than their local Starbucks.

However, it’s not just start-ups and microbusinesses that are attracted to the idea of co-working. Corporations are moving towards it too. The growing need for greater workplace flexibility and agility is leading more corporate companies to use co-working spaces for some of their space needs. And it’s a trend that looks set to accelerate over the next five years as businesses of all sizes look to reduce their exposure to long-term leases and employees insist on more flexible workplace options.

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Spaces with benefits

 

Co-working members – who pay for a desk, a private office, or an area within a larger, amenity-rich space – include employees of established companies and even mega-corporations in need of flexible space. According to data from Emergent Research and the Global Coworking Unconference Conference (GCUC), there are now 14,411 co-working spaces around the world. What’s more, GCUC predicts that the number of co-working members will grow from 1.74 million in 2017 to 5.1 million in 2022, with 30,432 co-working spaces established by 2022.

In the UK, the number of flexible office centres tracked by the Instant Group has risen to 5,320 over the past 12 months and there are now more than 2,800 companies that have flexible office space as part of their portfolio. In London, between 25% and 30% of flexible space is occupied by large companies and corporates. In terms of capability, co-working spaces in the UK host, on average, 121 members, up from 102 last year (+19%), and significantly more than in 2016 (+81%).

So, while the co-working trend is undoubtedly on the increase, the big question still remains: Is co-working the right fit for your business, or is traditional office leasing the better choice?

 

The attractions of co-working

 

Flexibility tops the list of desirable co-working features. On a monthly basis, members can decide the type of workspace that best suits their needs – which helps avoid upfront fees, deposits, and the contractual obligations of a lease.

Must start immediately? No problem. Want reliable, high-speed Wi-Fi, printers, and coffee on demand? You're covered. Need a spot that's pet-friendly, has a staffed reception desk, and even luxe amenities such as ping-pong tables, nap stations, and a gym? You'll find it.

Different co-working options offer the basics and beyond. When you don't have worry about furniture or supplies, work can become the sole focus.

In addition, many co-working spaces offer much more than space and kit. Members can attend hosted lunch workshops and other networking events designed to mentor and connect potential clients and investors. For example, LAB by Capacity in Liverpool, aimed at supporting start-ups, social enterprises and growing businesses, provides industry-specific guidance needed to grow a sustainable organisation. LAB mentors specialise in a variety of areas, including investment, digital marketing, web and app development, digital marketing and workplace wellbeing, all as part of the package.

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The cons of co-working

 

Distractions are a fact of co-working life. Blurred lines between work and socialising can cause friction. On days you need to concentrate, an office-mate may distract your workflow by engaging in chatter. Plus, privacy is a concern – sensitive business or client-related discussions will involve trying to seek out a quiet corner.

It's also more difficult to brand. Even private co-working offices typically can't be decked out with your company’s logo or signage. Costs can easily add up as a company expands, too. Once you hire more than a few employees, traditional office leasing may be the bigger financial win.

 

The leasing option

 

Signing a lease is always a big moment, especially for a fledgling business. It’s a serious commitment, tying you to a place for years to come. And, of course, there’s upfront investment in furnishings, office equipment, renovations, and fit-outs to factor in.

Yet, picture this: your logo is on the door, with custom furnishings and decor that echoes your brand. You don't require permission to throw a party, host visitors for an event, or everyday tasks such as simply adjusting the thermostat.

Another positive is that in this age of co-working, traditional landlords are responding to the competition by offering their own flexible workspace and lease options, which may prove to be the ideal solution for your burgeoning business.

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Making the right decision

 

For companies with just a handful of employees, there’s no doubt that co-working could be the better investment. But there are some key questions to consider:

  • Do the values of the co-working environment or provider match those of you and your company? For any growing enterprise, it's essential to cultivate a unique company culture that reflects what your business has to offer. Before investing in a shared office space, consider the values and beliefs that the space follows or adheres to. Do these values fit with your business culture? If not, there could be difficulties ahead as your company's culture might transform to match that of the workplace space, rather than aligning with your enterprise’s mission, vision and values.
  • How conservative are your clients, and how often will they visit? Traditionalists may not see past the ping-pong table located en route to the conference room.
  • What will your company look like in a few years? When that's impossible to answer, an ultra-flexible co-working environment may be just the ticket. However, if a clear vision and growth plan is in the foreseeable future, an office lease may be the answer.

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