Searching for a new office can be a daunting process. Typically, if you are considering moving to a new space it’s usually due to the following:

• You’re on the hunt for your first office as a new business
• You’re expanding as a business and need to escape your home office.
• Your current office is not the right space anymore.

Where to begin?

The thought of renting a traditional office space and undertaking the initial administration, such as contracts, leaseholds and sqm costings may overwhelm you. However, life can be simpler and Serviced Offices are your answer. Serviced offices may seem like a large initial outgoing but are in-fact comparable to renting a leased office. Below we go into the pros and cons of renting both and attempt to provide an impartial view of which is more beneficial for your business.

Leased (un-serviced) office

Leased offices mean the business rents directly from a building’s landlord on a price per square foot, per annum basis. Typically, the tenant will sign up to a long-term contract from anywhere between three to ten years, including a substantial deposit.

Businesses who take out a leased office are then in complete control of the appearance, configuration and working practices of their space.

• Pros
  • Longer leases mean businesses will be able to budget over the longer term.
  • Businesses have free reign on the appearance, branding and configuration of the space
  • Potential lower long-term costs and overheads.
  • Businesses are in total control of their workspace allowing the autonomy to develop and expand as they wish.
• Cons
  • Finalising a tenancy agreement takes significantly longer than a serviced office and can leave businesses with no workplace.
  • Often required to pay solicitor and commercial agent fees
  • Initial infrastructure costs can be substantial, from furnishing to utilities, bills, business rates, internet, and communication, as well as small but essential elements such as cleaners and general servicing of the building/office.
  • Capital expenditure for office reinstatement at the end of the lease.
  • Staff required for building management i.e. receptionist.
  • Longer lease obligation requires accurate profit budgeting
  • For newly established businesses a considerable deposit is often required to offset the non-payment risk.

Serviced office

A serviced office is an office space or building which is fully equipped and managed by a management company/office provider, renting individual offices to other companies.

Facilities in serviced offices usually include a free meeting rooms, kitchens and lunch areas as well as cleaning and maintenance services. One monthly bill is inclusive of absolutely everything, so there are no unexpected bills that creep up.

• Pros
  • Low initial costs and fast sign-up.
  • The option to sign up for a short-term lease of 12 months or opt for a longer two-year lease.
  • Move in immediately – fully furnished with communication infrastructure in place ready to work straight away.
  • Hassle-free management of utilities, cleaning visitors etc.
  • A simple, single price cost. No extra bills or charges
  • The opportunity to network with other businesses in the building.
  • Small businesses can concentrate on their own business rather than wasting energy on running a physical office.
  • Opportunity to expand or downsize with a short notice period.
• Cons
  • Limited opportunity to establish a brand identity on the external area of building
  • There isn’t as much scope for businesses requiring unique working environments.
  • Businesses with multiple visitors a day may find it inconvenient.

How much do Leased and Serviced Offices cost?

When comparing the price per square foot cost, leased office space will be slightly cheaper than serviced offices. However, these costs do not include many of the hidden costs associated with conventional offices. Ultimately, both office types are on a level playing field in this respect. A serviced office will appear more expensive at first glance. This is simply because it is priced per desk per month, rather than per square foot. However, it’s important to remember that this price is fully inclusive of most costs associated with the office. Overall, serviced offices pip leased offices to the post when it comes to ease of moving and hassle-free maintenance.