Serviced Office Review: South West – Q4 10
The report focuses on the following key areas in the South West *** 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 West was compiled to provide a comparative report of the changes within the serviced office market during Q4 10 compared to Q4 09.
***officebroker.com defines the South West region as areas located within the following postcode prefixes: BA, BH, BS, DT, EX, GL, PL, SN, SP, TA, TQ and TR
- SUPPLY OF SERVICED OFFICE SPACE
The number of serviced office buildings registered with officebroker.com in the South West increased from 152 to 158.
The total number of serviced office buildings registered with officebroker.com in the South West increased to 158 during Q4 10 ΓÇô representing a net increase of 6 buildings on the figure of 152 recorded at the close of Q3 10.
officebroker.com currently lists 2,616 active serviced office buildings in the UK, with the 158 serviced office buildings listed within the South West region accounting for 6% of the total UK supply offered / available through the officebroker.com service.*
*Information correct at time of publication
- DEMAND FOR SERVICED OFFICE SPACE
Enquiry levels increased by +42% during Q4 10
Quarterly Activity ΓÇô The total number of enquiries received for serviced office space by officebroker.com in the South West exceeded 2009 levels by +42% in Q4 10.
Year-to-Date Activity ΓÇô Having successfully generated increased enquiry levels throughout 2010, officebroker.com has received +45% more enquiries during 2010 than in 2009.
National Comparison ΓÇô During Q4 10, the overall number of enquiries received by officebroker.com throughout the UK increased by +42%, indicating that the increase which took place in the South West was trending in-line with the wider market during the final quarter of 2010.
* 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.
- NEW SERVICED OFFICE TENANTS (SOTs)
The number of newly placed SOTs was -45% lower in Q4 10
Quarterly Activity ΓÇô The number of businesses taking serviced office space through officebroker.com in the South West was -45% lower in Q4 10 compared to Q4 09.
Year-to-Date-Activity ΓÇô In spite of overall increases in the number of new SOTs during both Q1 and Q2, the number of SOTs entering serviced office space via the officebroker.com service is currently -25% below that of 2009.
National Comparison ΓÇô During Q4 10 the total number of SOTs taking serviced office space through officebroker.com was -26% lower than in the same period of 2009.
Having recorded a -45% decrease in SOT numbers during Q4 10, the South West would appear to have experienced a more substantial decrease in the number of newly signed SOTs compared to the majority of the UK during Q4 10.
- AVERAGE WORKSTATIONS PER SOT
Average workstation requirement increased to 4.2 in Q4 10
Quarterly Activity ΓÇô The average number of workstations per SOT totalled 4.2 at the close of Q4 10, an increase of 1.4 workstations (+49%) on the average requirement of 2.8 workstations recorded in Q4 09.
Year-to-Date-Activity – Taking into account all the activity recorded during 2010, the average workstation requirement in the South West has risen to 4.7 workstations – a requirement which is +10% higher than the 4.3 workstations recorded in 2009.
National Comparison ΓÇô Throughout the UK in Q4 10 average workstation requirements remained within 3% of the levels recorded in Q4 09, having risen from 3.6 to 3.7 workstations.
Comparing this national activity to that of the South West in Q4 10, both the percentage change (+49%) and average workstation requirement (4.2) exceeded the national average during this same period.
- SERVICED OFFICE SPACE COSTS
Average price per workstation was ┬ú210.00 during Q4 10
Quarterly Activity ΓÇô The average price per workstation in the South West was ┬ú210.00 in Q4 10, a decrease of ┬ú49.00 (-19%) on the average price of ┬ú259.00 recorded in Q4 09.
Year-to-Date Activity ΓÇô With lower prices having been recorded in 10 of the 12 months in 2010, the average year-to-date workstation price in the South West was ┬ú200.00, a price ┬ú54.00 (-22%) lower than the average price of ┬ú254.00 recorded in 2009.
National Comparison ΓÇô During Q4 10 the average price per workstation fell nationally by -3%, from ┬ú232.00 in Q4 09 to ┬ú226.00 by the close of Q4 10.
Comparing this national activity to that recorded across the South West, both the percentage change (-19%) and average workstation price (┬ú210.00) remained below national averages during Q4 10 ΓÇô indicating that market conditions have been tougher across this region of the UK during Q4 10.
- AVERAGE LICENSE LENGTHS
Initial license lengths increased to 9.1 months
Quarterly Comparison ΓÇô In Q4 10 new SOTs entering serviced office space in the South West through officebroker.com were signing average license lengths of 9.1 months, a licence length that is 1.7 months and +22% longer than the average license length of 7.4 months signed during Q4 09.
Year-to-Date Comparison ΓÇô As shown in Fig 11, initial license lengths have increased overall during 2010, resulting in the 2009 average of 5.6 months extending to 7.6 months at the close of 2010.
Despite the overall improvement in this area of the market, the 7.6 month average recorded in 2010 remains the lowest initial license length of any UK region during 2010.
National Comparison ΓÇô During Q4 10 license lengths averaged 8 months nationally, an increase of +14% on the average license length of 7 months recorded in Q4 09.
With an average license length of 9.1 months being recorded in the South West, businesses entering serviced office space via officebroker.com during this period were committing to an additional 1.1 months compared to the national average during Q4 10.
When taking into account all the information for Q4 10, the following key findings can be drawn:
- Enquiry levels continued to increase.
- The overall number of new serviced office tenants decreased.
- Average workstation price continued to fall below 2009 levels.
- Average license lengths increased substantially during Q4 10.
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