The serviced office sector is a hot topic at the moment: after establishing a presence in London there’s now been considerable movement by providers into the regions. 

According to our research, as a proportion of the Leeds office market, 17 per cent of take-up last year can be attributed to serviced brands. There are several good news stories for landlords that have come with the rise of these providers. 

The likes of The Office Group, WeWork and Spaces have disrupted the market, bringing the importance of creating an engaging and flexible workspace to the forefront.

Putting the needs of the occupiers first isn’t the most groundbreaking approach, however the influx of serviced office space has shone a light on the importance of creating a workspace occupiers actively enjoy being in. Occupiers now expect a certain level of facilities and a high quality fit-out from their office space, inspired by the more modern and attractive interiors that have become synonymous with serviced office providers.

This has been compounded by tenants willing to pay higher rents for good quality space, be it new build or refurbished. In Leeds there has been significant rental growth over the last couple of years, with top rents for refurbished space now standing at £28.50 per sq ft.

Serviced office providers can bring a new lease of life to a building, creating a  culture centered around communal activities, for example a yoga or HIT class or a happy hour networking session.

The mix of people within serviced office space can be beneficial in the creation of clusters. For example in the media industry, a serviced office could provide dedicated space for recording or editing content with the cost split amongst multiple tenants, all of whom benefit from the shared facilities.

According to Workthere, for a private serviced office the average desk cost per month in Leeds is £300; for co-working space this is £200 a month. The attractive pricing appeals to both small and large firms.

For landlords with several floors occupied by a single tenant, the addition of a floor or two of serviced offices can be useful ‘overflow’ space to be tapped into as a firm expands, without having to commit to a new premises.

The appetite for flexible and serviced office space has led to landlords being able to repurpose empty space in the their building and in response we are seeing the likes of British Land launch Storey and Landsec introduce Myo as their own flexible office brands.

There are plenty of benefits for landlords that are willing to open themselves up to addition of flexible office space, whether that be in the attraction of new tenants or to boost the satisfaction levels of their existing tenants.

Further information

Contact Savills Leeds

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