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What The Future Holds For Serviced Offices in UK? 4th Jul 2017

The traditional serviced office sector is still evolving as operators continue to invest in creating innovative spaces to cater to start-ups, SME’s and corporates alike. It has become a first choice for many first-time tenants, who previously  may have thought costs would be higher than a traditional lease.  Times have changed and it is proven that this not the case. Serviced offices offer the most transparent pricing around and users now enjoy all the services such as security, reception, cleaning, and internet access under one single monthly fee.

Serviced office and co-working lettings peaked at 1.7m sq ft in 2015, when they accounted for 15% of London’s commercial property scene and analysts foresee the sector’s value to grow over £62bn by 2025.  Major real estate owners are now seeking to catch-up by launching their own branded versions; but ti is the experienced and seasoned operators who have cracked the magic formula.

Currently, a perceived general market volatility is present due to Brexit, as expected by market researchers. However, London’s long-term growth in terms of serviced office demand are expected to be unchanged by the decision to leave the EU, as occupiers start to demand more flexibility in terms of location and the flexible lease structure. In this sense, serviced offices are a very popular option as both contracts and space designs are flexible to meet any requirement. Also, the location of established serviced offices act as a “talent magnet” for  those occupiers ahead of the curve. Through provision of leisure and transportation facilities and the character of the district, businesses of all sizes can attract and retain talent. This is one of the reasons why we see an ever-increasing interest in The City of London and West End as preferred serviced office locations. Giving rise to the traditional borders of the City of London being redrawn, with an increased interest in EC3 and EC4 locations. 

CBRE 2017 Q1 forecasts indicate a slight rise in serviced office sector growth for the rest of the year. Despite this forecast, we expect lower levels of jobs growth across the country. In order to moderate the effects of this on serviced office industry, extended rent free periods and greater flexibility in lease terms will be the key. At Targetspace, our high quality serviced offices in the City of London and Central London can be occupied for as short as 1 month to as long as needed. Offering bright, fully furnished serviced offices with 24-hour access, friendly and professional on-site teams which are there to help whenever you need. If you’d like to get more information on our available serviced offices in Liverpool Street, Aldgate and Holborn, get in touch with us here