Occupancy also slipped 0.6% in the same quarter.
Among the many changes that we have witnessed over the past year is the overnight shift to flexible working. With this, coworking spaces have become synonymous with flexible office spaces, but how exactly do they differ from serviced offices?
Since the COVID-19 pandemic began, the way companies use office spaces has changed. Having seen the advantages of a flexible working environment, many employees have embraced such arrangements, with many showing signs that they might prefer them when the COVID-19 restrictions are lifted. Admittedly, some employers are not so keen on this.
It is still early to say with certainty how the post-pandemic work environment will look. As the debate continues, one thing is clear – the traditional notions of working have been disrupted and businesses must adapt to this new norm.
We’ve previously discussed the ins and outs of coworking spaces – one of the two flexible workspace options which come readily to mind, with the other being a serviced office.
These two types of flexible spaces offer companies the opportunity to build a base for their businesses without the additional burden and rigidity of a traditional office. So, what are the differences between them and which would be best for your business? We understand that choosing an office space is no easy task, so in this article, we will break it down for you:
A serviced office is a fully furnished and equipped office space that is leased out by a flexible office provider. Operators typically rent out single spaces, executive suites or entire floors to their tenants, providing them with access to a private, ready-to-use office space on flexible terms.
Also known as managed offices, executive offices or business centres, serviced offices are occupied by corporations of all sizes – from startups to teams of 20 or more.
Unlike traditional workspaces, serviced offices are usually already fitted out with all the furnishings and amenities that a typical office provides, such that businesses can be up and running as soon as they move in. These perks are inclusive of their monthly fees so businesses do not have to worry about hidden costs or expensive CAPEX spending.
Common features include utilities such as phones and high-speed internet connectivity, facilities like conference rooms, boardrooms and communal spaces for meetings and networking, and high-quality technological equipment including copiers, audio-visual and video conferencing tools, all of which have become essential to working during the pandemic. Some serviced office providers even offer managed reception desks that will give members and their guests a warm welcome when they enter the premises, as well as provide necessary administrative support.
As companies have begun prioritising the health, safety and well-being of their staff in the wake of the pandemic, many serviced offices also come with services such as maintenance, cleaning, security and even recharge rooms where members can take a quick nap during the day. This is in addition to other pay-as-you-go options and nearby restaurants, gyms, events areas and more.
For businesses, having access to such premium amenities without the huge capital outlay is a bonus, especially for small enterprises that are just starting. These facilities may range from place to place, tailored to the needs of each company.
Crucially, what makes serviced offices different from traditional office spaces is the flexible lease term packages that enable companies to scale up or down as required.
In contrast with traditional workspaces, which typically have long leases and lengthy commitment periods, many serviced offices offer flexible rental terms with contracts that can be as short as one month. This makes it easy for companies to expand or reduce their space according to their business plans. Tenants can rent out a single office cubicle or combine adjoining spaces for larger groups, configuring them to the size of their teams.
What is more, serviced offices are usually situated in desirable business districts and have several locations around the world, giving members access to new markets and global business centres for expansion.
These are some of the advantages that make serviced offices ideal for small enterprises, offering the opportunity to set up their businesses at an address that would otherwise be unaffordable. It is also ideal for larger corporations that need a temporary space for short-term projects, office relocations or even a full-fledged permanent office
Another type of flexible workspace that you might be familiar with is coworking spaces.
These spaces have come to the fore over the past year as employees adopted remote working during the pandemic. Coworking spaces provide members with a change of scenery that is away from home, while still being in a working environment that is far from a traditional, stuffy office space.
This workspace alternative offers tenants a more relaxed and casual way of working. Coworking spaces include an open-concept floor plan designed to optimize collaboration and networking between members. The emphasis here is on the lifestyle element, with features and amenities such as pool tables, bars and nap rooms, as well as regular community events such as weekly lunches or networking drinks that are managed by a community manager who is in charge of maintaining the space’s unique culture.
Like a serviced office, coworking spaces provide communal facilities including pantries, lounges and breakout areas. Fully furnished with all the necessary amenities, these are ready-to-go workspaces that are often occupied by freelancers and lean start-ups. They tend to be a fit for those with a creative and entrepreneurial spirit who would like a space to interact, meet new people and build their networks. Leases are also flexible with even shorter rental options, where desks can be rented by the hour, day or month, making it easy for members to scale up or down as their businesses evolve.
However, what makes a serviced office different from a coworking space is that the former provides members with a place to conduct their business in a more private environment. For some hotdesking clients in coworking spaces, a common drawback is the lack of a secure and private space. For these people, the solution would be to procure a dedicated workstation or storage space from their coworking operator at an additional cost.
On the other hand, serviced offices usually offer tenants a private suite that allows individuals or teams to work in confidentiality and privacy. These spaces provide a sense of permanence without the overheads and expenses. They are the preferred choice for small and growing businesses that need a professional and flexible working environment at which to conduct their business, while still providing a community to network with and build relationships with.
Serviced offices and coworking spaces are dynamic and flexible work environments that are part of a growing global shift as businesses look for more agile ways of procuring offices. As the COVID-19 situation around the world remains unpredictable, many companies these days are looking for a low-commitment and cost-effective solution that allow them to adapt to the evolving situation.
Both types of flexible workspaces offer companies a myriad of options and benefits that allow them to transit to the future of work. Ultimately, deciding between the two boils down to your company’s needs and expectations.
Some questions you could consider are:
1) Do you need a flexible space that provides privacy and professionalism or one that is more open and collaborative?
2) How much space do you need?
3) How often and how long do you need it for?
4) What are your budget constraints?
Making the move into a new office space is a big deal. It is important to take the time to properly assess your business priorities and understand what is important to you and your employees.
Occupancy also slipped 0.6% in the same quarter.
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