Is it Time to Move to a Managed Office?
As we start to allow ourselves, in a whisper, to consider what working life might be like after Covid, it is likely that you have been trying to work out the best approach for your business and the slow return to the office.
You are not alone. Most of the businesses we have been speaking with over the last 12 months have said something similar, in that they plan to have an office, but what that looks like now is still yet to be determined. There are so many moving parts to consider when planning your next steps.
Pre-Covid 19, it was totally acceptable to expect staff to work in an office Monday — Friday, 9–5. That is unlikely to be the case for everyone moving forward. The reality is that the trend/s need to settle down to what ever the new normal is and that will take time. One thing is clear however, the clock watching dinosaurs may finally have been pushed aside.
We need to be mindful that productivity is key and much of that productivity will come from being together as a collective. People learn and thrive from like minded people. If we have learnt anything in recent months past, it is that a screen is a poor replacement for a face to face catch-up.
Going forward it seems likely that the key term, when asking what people will be looking for when returning to the office, is flexibility. No doubt this is also true for both employers and employees but this is all about balance.
In the office world, flexibility is by no means a new concept, but with most companies not knowing what is happening next week, the continued movement away from long term commitments and towards shorter leases or licenses, seems to be certain. This trend is primarily owed to landlords, who are increasingly offering their own flex concepts with short term requirements on commitment. With many real estate companies, landlords, serviced office providers and even fit-out firms now providing managed office solutions, it is pipped to become the next big, flexible office trend as we enter the “new way of working”.
What is a managed office?
A managed office is a fully mandated workspace solution. Everything is taken care of for you, from design and fit-out to operations and utilities — all wrapped up into an all-inclusive monthly cost. In some cases, providers will even source the building for you, but as popularity for these types of spaces grows there are many pre-designed options ready to go.
Managed offices usually come in the form of multiple, single or part floors. They are self-contained spaces with kitchens, breakout space and meeting facilities all designed around your business needs and dedicated to you.
What is the difference between Leasehold, Managed and Serviced?
What are the benefits of a Managed office?
The managed solution is a Hybrid between Leasehold and Serviced, taking all of the best bits from each and combining them into one product.
It’s not just about desks and meeting rooms anymore. This isn’t a one size fits all product! We’ve spoken about bespoke design based on your individual needs but this includes more hot-desking alternatives, bench style collaboration tables, one to one booths, all hands / town hall spaces and soft seating for informal chats.
The likelihood is that for many businesses the first return to the office will be to encourage collaboration between teams and colleagues rather than just another desk to work from. Fortunately, most providers of managed space have what is referred to in the industry as “day 1” models and “day 2” models, giving you the opportunity to adjust the configuration and furniture choice, adapting to any business changes.
What are the pros and cons with a Managed Office?
The pros and cons really depend on whether you are considering Leasehold vs Managed or Serviced vs Managed. What some consider a pro may be a con to others and vice versa.
· Shorter term commitments from 12 months+ vs much longer term of leases on the conventional side.
· Simplicity — All-inclusive monthly cost.
· Fit-out and design to your specification.
· Brand identity and privacy maintained.
· Speed to occupation from commitment
· No dilapidation costs.
· Cost — typically a more expensive alternative to a lease. You do pay for flexibility; however, it is important to work out all of the costs associated.
· Less flexibility than a serviced option/
· Lack of community.
· Minimal communal facilities outside of your office.
The Medium Term Dangers for Serviced and Managed
The market is extremely volatile and it seems very likely that serviced and managed will experience a period of positive activity but what about after that? As the markets correct over the next few years and we move into more certain times, will we not see the longer leases re-establish themselves? That is a longer-term issue but between now and then there is an undeniable correction that we have to adapt and deal with. We are far from the bottom of the markets and as this all develops, the amount of money that is required to accommodate the ease of a serviced or managed solution, it seems plausible that these providers will struggle to keep up with the price points required to secure income, vs what the conventional market and associated landlords will require, now that they have had there eyes very much opened to the world of shorter term licenses or agreements.
At SHB we specialise in advising tenants & Landlords on their real estate strategy. If you are interested to learn more about managed office space and how it could work for you, we are here to help. Our team of experts are the best people to assist with your unique requirement.
Get in touch today to start the search for your next office space!