Differences Between Serviced Office Spaces, Leasehold Office Spaces, and Coworking Spaces
Are you making the change from working at home to moving into an office space? Have you considered which type of office would be best for you? Do you understand the differences between coworking spaces, serviced office spaces and leasehold office spaces?
These are important questions that need to be understood in order to find the best type of office space for your business, whether you’re a freelancer or growing business.
Traditional Office Spaces
It was once the norm to work in a traditional office building. The business would enter into a lease with the landlord, and then set up shop. Offices were structured into large floors with typists, and then other workers were situated in small, drab cubicles or in private offices for those in higher positions. Over the years, cubicles became the standard model in a traditional office.
Businesses still use the traditional office model; however, alternative office spaces have taken over the traditional office model.
Leasehold, Serviced, and Coworking Office Spaces Defined
Each type of office space is usually easy to understand, though people who are not familiar with these alternatives may not see the differences. Let’s take a look at the definition of each office type.
- Serviced Office space: these generally include office furniture such as desks/tables, chairs, IT infrastructure, professional admin support and other perks.
It’s fast and easy to pack up your business and make the move to a serviced office. There’s little downtime, and all the services and amenities you need will be ready and included in a single monthly fee. All you have to do is plug in and start working.
- Leasehold office space: this is the traditional office model, which involves work to find the right location, and then negotiating the lease with a landlord.
In this setup, you are responsible for all office furniture, utilities, maintenance, cleaning and more. Moving in will involve more planning and possible downtime.
- Coworking office space: this is a relatively new office alternative, which has been especially popular with those who are self-employed but is seeing fast popularity with larger businesses. In this type of office space, workers share workspace with others.
This one of the cheapest options for office space, and many coworking office spaces offer flexible contracts.
Now you know the definition of each type of office space, do you know which would be best for you? One way to help determine which is best for you is to go through and review the pros and cons for each.
Serviced Office Spaces
- Moving in is easy: before you move into the new office space, everything will be setup and waiting for you. This includes office furniture, utilities, phone, Internet and more. Your business will not suffer a long delay in operations. Instead, moving in is fast—once you’re moved in, plug in and start working right away.
- Flexibility: this might be a great option if you believe your business will expand. Serviced office spaces usually offer flexible contracts. They also offer additional space (depending on availability), so your company’s free to grow. You’re not committed to just a certain amount of space, which is the case with a leasehold office space.
- Cost-effective: some believe that a serviced office is too expensive. However, when you consider all that comes with your monthly fee, you may realise that the serviced office offers more value for the money. The fee is all-inclusive, which means it covers everything—from the office furniture to accessing the IT infrastructure. It’s all included in the monthly fee.
- No control: you often won’t have control over the design elements of serviced office spaces. In addition, you may share a meeting room and other services. On the plus side, if you’re happy for the service provider to handle all of the design and deliver a fresh, high spec space, then this could be a positive.
Leasehold Office Spaces
- More control: you’ll have more control over the space with this option. Leasehold offices generally allow the business to determine the space’s décor, arrangement and design. It’s easy to brand this blank canvas, and you choose the amenities and services for your business.
- Length of contract: leaseholds typically last for about 3 years. With this type of office, a business will need to determine if it will expand or not. Once you’re in the space, that’s it. There are not always options to add on office space when the company expands.
- High startup costs: when it comes to getting the office set up, you’ll face the need of buying all the office furniture, installing utilities, adding an IT network and more. In addition, if a problem develops with the space, you must pay for the repairs and replacement. This could end up as a large, unexpected cost later, something that’s difficult to budget for.
- Waiting period: after you’ve agreed on the lease with the landlord, you’ll need to wait as everything is put in place. This includes the delivery and arrangement of furniture, setting up office equipment, utilities and all. This can cause a serious delay with business operations. Delays are not viewed with favor by clients and partners.
- No flexibility: when it comes to a leasehold contract, you’re looking at a minimum commitment of three years. During that time, if your business expands, it will be impossible to add on additional offices or to move to a larger space. If you expect your business to grow, then this is probably not a good option for you. This is a better option for companies that will remain the same size over the lease period.
- Hassle: You’re responsible for all of the utilities, cleaning, maintenance and everything else. If the internet becomes slow, that’s your problem to resolve.
Coworking Office Spaces
- Cost: one of the advantages of coworking office spaces is the cost, which is usually the most inexpensive option for a business. You’ll enjoy all the same services of a serviced office space, but the cost will be lower at a fixed cost per person.
- Flexibility: coworking office spaces are also available for short periods. In addition, you’ll be able to work when you want. It’s easy to have a more flexible schedule with a coworking office space.
- Socialising: another benefit of a coworking office space is the socialisation which takes place in this environment. This might be a great option for freelancers who would like to upgrade from their home office as well as remote workers. It’s fun and easy to work and collaborate with like-minded professionals. Coworking office spaces provide opportunities to network, too.
- Privacy: coworking office spaces are not always the best option if your business has proprietary information. There’s also a lack of privacy when working with clients and partners. While it’s possible to hire a meeting room, you may find it costs extra, which will have an impact on the company’s budget.
- Branding: you won’t be able to brand your space in a coworking space, although some coworking providers offer private spaces where it’s possible to customise the décor and more.
Summing It Up
We’ve reviewed the major pros and cons found with each type of office space. When it comes time to make a decision for your company, it will depend on your budget, and which space offers the right setting and services to fit your business needs.
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