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Serviced Office Review: South East Q2 10

Serviced Office Review: South East Q2 10
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Download a pdf copy of this report by clicking here.

This report focuses on the following key areas in the South East *** region:

  • Supply of and demand for serviced office space – In terms of the number of enquiries, the size and shape of those enquiries and the number of placements.
  • New Serviced Office Tenants (SOTs) – In terms of workstation prices and initial license length commitment.
  • Using the statistics from these areas, a detailed overview of the serviced office industry in the South East was compiled to provide a comparative report of the changes within the serviced office market during Q2 10 compared to Q2 09.

    ***officebroker.com defines the South East region as areas located within the following postcode prefixes: BN, CT, DA, GU, ME, MK, OX, PO, RG, RH, SL, SO, TN.

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    http://www.officebroker.com/images/articles/Serviced Office Review - South East - Q210 - Fig1.jpg

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    • SUPPLY OF SERVICED OFFICE SPACE

    The number of serviced office buildings registered with officebroker.com in the South East increased from 349 to 351.

    The total number of serviced office buildings registered with officebroker.com in the South East increased to 351 during Q2 10 ΓÇô representing a net increase of 2 buildings on the figure of 349 recorded at the close of Q1 10.

    http://www.officebroker.com/images/articles/Serviced Office Review - South East - Q210 - Fig2.jpg

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    • DEMAND FOR SERVICED OFFICE SPACE

    Q2 10 Enquiry Levels exceeded those of Q2 09 by +58% overall.

    Quarterly Activity ΓÇô The total number of enquiries received by officebroker.com for serviced office space in the South East increased by +58% in Q2 10 compared to Q2 09.

    Year-to-Date Activity ΓÇô This additional +58% increase in enquiries recorded by officebroker.com in Q2 10 follows a +61% increase in Q1 10, meaning the number of enquiries received by officebroker.com for serviced office space in the South East during the first half of 2010 was +60% higher than in 2009.

    National Comparison ΓÇô During Q2 10 the total number of enquiries received by officebroker.com throughout the UK increased by +33% compared to Q2 09, indicating that the percentage increases seen in the South East were substantially higher than this Q2 10 national average.

    * Effective from 1st February 2010, officebroker.com extensively expanded its online marketing and affiliate program.

    As a direct result of this activity the number of enquiries received by officebroker.com increased substantially from February 2010 onward. Such increases, while generating abnormally large changes when placed against previous data, will ensure that the statistics reported by officebroker.com are an even more accurate assessment of the serviced office market here in the UK.

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    http://www.officebroker.com/images/articles/Serviced Office Review - South East - Q210 - Fig4.jpg

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    • NEW SERVICED OFFICE TENANTS (SOTs)

    +15% increase in the number of SOTs in Q2 10 compared to Q2 09.

    Quarterly Activity ΓÇô The number of businesses taking serviced office space through officebroker.com was +15% higher in Q2 10 than in Q2 09.

    Year-to-Date Activity ΓÇô During Q1 10 the number of new SOTs taking space through the officebroker.com service also exceeded 2009 levels (+24%), meaning that the number of SOTs taking space via officebroker.com in the South East has increased for a 2nd consecutive quarter and was 20% higher than in the same period of 2009.

    With officebroker.comΓÇÖs sales cycle averaging 59 days from initial enquiry to placement, it would appear that the additional enquiries generated in Q1 10 (+61%), a result of the increased marketing activity outlined in the previous section of this report, has helped to secure a greater number of SOTs taking office space in the South East region through officebroker.com during Q2 10.

    National Comparison ΓÇô During Q2 10 the total number of SOTs taking serviced office space through officebroker.com increased nationally by +5% on Q2 09 levels.

    At +15% the increase in SOTs recorded in the South East is higher than the national activity recorded by officebroker.com during this same period.

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    http://www.officebroker.com/images/articles/Serviced Office Review - South East - Q210 - Fig6.jpg

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    • AVERAGE WORKSTATIONS PER SOT

    Average workstations per SOT rose from 4.2 in Q2 09 to 4.3 in Q2 10.

    Quarterly Activity ΓÇô The average number of workstations per SOT totalled 4.3 at the close of Q2 10, an increase of +2% on the average workstation requirement of 4.2 per SOT recorded in Q2 09.

    Year-to-Date Activity ΓÇô Having recorded a decrease in average workstation requirements during Q1 10, which fell from 5.0 workstations in Q1 09 to 4.5 workstation in Q1 10 (-10%), the overall workstation requirements of those entering space through the officebroker.com service in the South East were -4% below 2009 levels in the opening 6 months of 2010.

    National Comparison ΓÇô The average number of workstations per SOT throughout the UK increased from 3.8 in Q2 09 to 4.5 at the close of Q2 10 – a rise of +16%.

    Comparing this national activity to that of the South East in Q2 10 (+2%), it would appear that those entering serviced office space through officebroker.com were trending lower than the national activity recorded by officebroker.com during this same period in terms of average workstation requirements.

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    http://www.officebroker.com/images/articles/Serviced Office Review - South East - Q210 - Fig8.jpg

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    • SERVICED OFFICE SPACE COSTS

    Average price per workstation increased by +6% in Q2 10 compared to Q2 09.

    Quarterly Activity – The average price per workstation in the South East was £244.00 in Q2 10, an increase of +6% on the average price of £230.00 recorded in Q2 09.

    Year-to-Date Activity ΓÇô This Q2 10 increase follows a previous rise in workstation prices being recorded by officebroker.com in Q1 10, which ended +10% above Q1 09 levels.

    Based on this 6 month period in which average workstation prices exceeded 2009 levels overall, average workstation prices in the South East during the opening 6 months of 2010 were +8% higher than in the same period of 2009.

    National Comparison – During Q2 10 the average price per workstation fell nationally by -13%, from £274.00 in Q2 09 to £238.00 by the close of Q2 10.

    Comparing this national activity to that of the South East in Q2 10, both the percentage increase (+6%) and the average workstation price (£244) recorded by officebroker.com exceed that of the national activity recorded during Q2 10.

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    http://www.officebroker.com/images/articles/Serviced Office Review - South East - Q210 - Fig10.jpg

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    • AVERAGE LICENSE LENGTHS

    Initial license lengths increased to 6.7 months in Q2 10 from 5.6 in Q2 09.

    Quarterly Activity ΓÇô In Q2 10 new SOTs entering serviced office space in the South East through officebroker.com were signing average license lengths of 6.7 months, an increase of 1.1 months (+19.6%) on the average license length of 5.6 months recorded during Q2 09.

    Year-to-Date Activity ΓÇô The increase in average license lengths recorded in Q2 10 follows a decrease of -10% in average license lengths during Q1 10, meaning that in the opening 6 months of 2010 average license lengths in the South East remained within 2% of the average license lengths recorded during the same period of 2009.

    National Comparison ΓÇô During Q2 10 license lengths averaged 7.3 months nationally, an increase of +6% on the average license length of 7.0 months recorded in Q2 09.

    With an average license length of 6.7 months being recorded in the South East, businesses entering serviced office space via officebroker.com during this period were committing to 0.6 months less (-8%) compared to the national average during Q2 10.

    The average license length of 6.7 months within the South East was one of the lowest of any UK region during Q2 10, with only the North East (6.4 months) and South West (6.3) regions recording a lower average license length in Q2 10.

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    • SUMMARY

    When taking into account all the information for Q2 10, the following key findings can be drawn:

    • Enquiry levels increased by +58% during Q2 10, building upon an increase in Q1 10.
    • The overall number of new serviced office tenants increased for the 2nd consecutive quarter.
    • Average workstation price exceeded 09 levels for the 2nd consecutive quarter in Q2 10.
    • Average license lengths exceeded Q2 09 levels in Q2 10 but were one of the lowest average levels recorded in any UK region.

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    Author: | August 3, 2010 | 0 Comments

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