Serviced vs Leased Offices: What’s Best for Your Company
8th August 2022
Serviced office✔️ ❌ Leased space
Last month, the Financial Times reported that a record number of companies are signing their first London office leases. Searching for a new home for your company can be an exciting but daunting task due to several factors you need to consider – the location, price, size, capacity, contract length, type and so on. One point of confusion is the difference between serviced and conventional leased offices. To help businesses navigate this and settle down in their ideal workspace, Landmark has written a guide to serviced and leased offices.
Do you prioritise time and convenience or cost-saving and autonomy? The answer to this question will likely determine which type of office you prefer.
What is a leased office?
A leased office is one that businesses rent directly from the building’s landlord on a price per square foot, yearly basis. It requires leasers to commit to a long-term contract, often multiple years. Although a large deposit and initial costs are required, the average costs are often far lower than serviced offices. Furthermore, since companies are leasing directly from the landlord they have greater autonomy with regards to the appearance, layout and practices of their workspace.
By the same token, leased offices require substantial time and financial investment to set up. No furniture, internet, equipment or services are included in the contract, so it is down to the company to furnish and set up their workspaces. The long length of the contract also reduces the ability of the company to move, downsize or upsize quickly in response to either their own business needs or outside factors.
What is a serviced office?
By comparison, serviced offices are workspaces or buildings that are managed by an office provider like Landmark that then rent these offices to companies. These offices are fully furnished and serviced and are ready for companies to move into instantly. They have the benefit of being arranged and equipped by experts in interior design & commercial real estate and are thus laid out with everything your company needs, from private office spaces to high-end meeting rooms and low-pressure social and collaboration coworking spaces.
Serviced office contracts include rent, business rates, service charges, fit-out, utilities, cleaning and maintenance, reception, security and support teams, legal fees and much more. That is reflected in the price compared to the price of leased offices, which only include basic rent charges and put the responsibility and upkeep of everything else on the business to sort out.
These up-front costs required for leased offices, as well as the rigidity of leased office contracts, make it difficult to settle down quickly into a new office. By comparison, serviced offices have far lower up-front charges and offer more flexible and short-term contracts so that your company can hit the ground running in its new workspace.
Companies in leased space have to make arrangements for cleaners, caretakers and receptionists, striking and reviewing utility contracts, sourcing furniture and so on. For many smaller, high-productivity businesses, spending time on non-core business functions like this doesn’t make sense, which is why more and more are choosing to go into serviced offices.
Overall, while leased offices appear to be the cheaper solution, serviced offices greatly simplify the moving process for companies and save them considerable time and effort which allow them to focus on the core purpose of your business.
Landmark has made it so that companies do not need to sacrifice autonomy in serviced offices. Clients retain the ability to change the layouts of their private offices to meet their team needs and the flexibility of Landmark’s contracts mean that businesses can react quickly to changing trends and upsize or downsize as required. Furthermore, leaving the running of your workspace to Landmark means that you are free to run your company without the burdens of building maintenance, furnishing and servicing.
To find out more about the differences between leased and serviced offices and how Landmark can help you with the needs of your business, feel free to contact us at email@example.com or 0203 440 5000.