Which office space agreement is best for me?
Here at officebroker.com we receive lots of varied questions from our office providers and clients. Perhaps one of the most frequent is the difference between the types of office space and office agreements available, so we thought we’d explain them here for you.
There are four types of office space:
Freehold is, quite simply, a purchase. You can buy a property, a floor or a given area from the office provider, and this office space is then yours to use, rent or do with as you wish.
Leasing is an agreement between you and the office provider which means you will occupy the office space for a set period of time. The length of time you lease the building or office space varies, but leasing is typically a long-term agreement that lasts several years.
Subleasing ΓÇô also known as subletting ΓÇô is an agreement usually tied in with leasing (above). It’s often a 3-stage agreement, as follows:
- Tom owns an office
- Tom the office owner leases his building to Dick
- Dick then sub-leases the building to Harry
The client who first leases the office ΓÇô Dick ΓÇô must make sure that the amount of time he is sub-leasing the office to Harry does not exceed the amount of time on his agreement with Tom. Sub-leasing is often a useful agreement if you find that you have leased a building in London for 5 years but then decide to move to Liverpool halfway through your agreement. Sub-leasing is an option that will usually save you money and prevent any difficult or costly cancellation procedures.
Finally, a licensed agreement is similar to leasing, but is usually over a shorter period of time and is much more flexible. Also known as serviced offices, these arrangements often come with extras such as broadband, phone lines, and fully installed cabling. Some agreements also include furniture, a manned reception, security systems and so on.
Here at officebroker.com, most of our office providers are in the licensed (or serviced) market. There is a further variety of licensed offices available, including unserviced, semi serviced and fully serviced ΓÇô these are explained in more detail below.
Unserviced offices… An unserviced office is simply an empty office space within a building which is maintained by the office provider. There are no add-ons or extra facilities.
Semi serviced or managed offices… This group of offices can be hugely varied, so tackle this definition with caution! In general, as the name suggests, a managed or semi-serviced office is the same as a serviced office but with, to some degree or other, fewer services available. You’ll usually find that the rent and payment terms are the same as a fully serviced office, and the building will still be managed and maintained by the property provider. The offices or suites will also usually be decorated but they may not come with specific services such as desks, chairs, broadband, telephones, meeting rooms or reception facilities available.
Fully serviced or serviced offices… A serviced office provider will sometimes call themselves ‘fully serviced’ in order to definitively differentiate themselves from the semi-serviced or unserviced office industry. Firstly, a fully serviced office has its size defined by the number of workers it can hold rather than the square footage. This number gets referred to as the number of ‘workstations’.
With a fully serviced office you should easily expect a decorated office or suite in a fully fitted out building which is managed and maintained by the office provider. The building should have its own reception area which services all of the providers’ tenants and is managed by staff employed by the provider. Some serviced offices also supply secretaries which can be used or hired as required by you.
In terms of furniture in a fully serviced office, you should expect to find desks, chairs and ideally some storage such as filing cabinets and cupboards, although this isn’t standard so is usually an added bonus. Each workstation should have a broadband connection and telephone line although again this can vary. Communal areas such as kitchens and W.C. or bathroom facilities are managed and maintained by the provider, as are meeting, conference and board room facilities which can be hired as and when you need them.
All serviced office space often requires a deposit and monthly rent payment terms. Generally the rent terms and conditions will be fairly flexible and allow you to take for or less space as the needs of your business change.
It’s worth noting that different types of office will have a different types of terms and conditions. Similarly, these can vary between office providers too.
The difficulty with applying definitions to licensed or serviced offices is that office providers offer such different levels of extras and services. However the good news is that on the officebroker.com search results you can now see a full set of ticks and crosses, depending on which services are offered or not. You can also compare up to 3 properties via the website, before submitting an enquiry.