Table of Contents. A Guide To Office Space & Business Centres Across London

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1 1 A Guide To Office Space & Business Centres Across London Table of Contents Introduction Advantages of Renting London Office Space Location, Impression & Operations Office Space Where to Start Types of Rentals What to Expect in a Lease Negotiating Summary

2 Introduction 2 In today s business, owners really want the best quality office space that meets ever-tightening budgets. Renting commercial property can be complex. Scaleable offices that can grow as business expands are desirable, but is it costly? If you wish to discover more about investing in office space instead of purchasing your own business property which, in itself is a minefield then we have put together this e-book guide to help. We are experts in our field and throughout this book will introduce you to straightforward ways of finding office space in particular locations; comparing your choices and help you tap into the world of renting commercial property through negotiation. The committed team involved with this e-book, have been professionally involved in either a business centre property, self-owned space or the rentals market. So, with in depth knowledge of the sector, we combine simple advice with expert knowledge to help you select the best option for you and your business. Advantages of Renting London Office Space Keeping overheads to a minimum is vital in running a successful business. With IT departments, staff, office space and company infrastructure making up the majority of the overheads, it really does pay to conduct your research and shop around for best deals. Think of London and you may think hiked prices and expensive service charges. Whether you are a start up looking to launch with your few employees from a home office, or a home working entrepreneur, signing a new office lease can be one of the most daunting tasks, yet considering London as a base doesn t have to be pricey. So why rent in London when there are perfectly good business centres hiring out office space in other cities, like Manchester and Birmingham? Location is key. It s easy to commute into London from both the surrounding regions and from other areas, so in that respect it s pretty central. London may be competing with other large cities; Edinburgh is such a popular place for business owners. But potential locations are only useful to business if you intend to trade in those areas, or can successfully run the business from there. For example, if you intend to deliver products from a far-flung place that is difficult to get to for a month over the winter season, that month of lost business and little turnover may be detrimental to the success of your business. London is a huge place and renting office space outside of central London can mean the difference between hiked up prices and affordable leases. There is clearly a huge advantage in lower rental prices, so office space just outside the main central area is cheaper where rating liability and service charges are concerned. In summary, considering areas just outside of London means the price drops considerably great news for new business, or for those looking to save costs and move out of the city centre.

3 Location, Impressions & Operations 3 The area, where you are located, the impression you want to give off and your business operations will all determine the type of area and the type of lease you choose. Location Your London office space will speak volumes about your business so where the property in which you choose to settle will affect your business. If you expect many visitors or regularly host events you may choose a city centre location that is easily accessible from the underground or mainline stations and close to a number of hotels. However, outlying areas of London can be more easily accessed by car, which can be more convenient to both your visitors and employees. It can also help you save massive amounts of expenditure by way of rental fees, lower salary rates and increased amounts of space. By thoroughly researching an area you may be unfamiliar with, you can find out much more about the neighbourhood every London borough is different and amenities and atmosphere change distinctively from one to the next. Impressions You are already at an advantage as far as London and architecture comes. From period style buildings through to brand new business complexes, there are not many cities in the UK that rival the area. Every style conveys a different impression, so a new business operating a contemporary type of company may choose new modern developments over traditional buildings. Freelancers may choose a young vibrant and modern development with all mod cons and less expensive rates, where a larger more established company may choose to settle in a period building in the more expensive areas of London. Operations As far as London is concerned, it s not unusual for employees to work outside of normal office hours. It s vital to select somewhere with security and access a priority, where you can monitor employees and who works after hours. It s not an unusual request from employees, and even if you re a freelancer or working on your own for now as a start up, you may wish to access your office space 24/7. This is true even with serviced offices, there may only be reception support in office hours, but it may be important to you to be able to get into your space whenever you need to. Office Space Where to Start Whether it s a planned move from a home office, or you intend to move your business as a cost saving exercise, once you have decided its time to move you are possibly entering into a territory unknown to you. Firstly, you will most likely know the rough location you would like already, so you can start looking in the area with some of the following things in mind. In general, new business start-ups don t require a great deal of space, yet you may have outgrown the home environment or simply can t face working in solitary! There s the option to hot desk hiring desk space in a purpose built office environment or to hire a whole office and run it as your own. Finding office space will mean you have to consider all manner of priorities. The main thing is that you find somewhere that you can efficiently operate your business from. It is possible to find well-priced office space with differing working areas to suit you and your business. Depending on what you are searching for, you will find a number of different types of leases with individual options to suit just about any type of business. Hiring a desk area will provide you with the desk space, along with any internet connections you need. Whilst hiring a serviced office may feature more desirable benefits such as a receptionist and cleaning services it can be expensive for some. Rentable desk space and shared offices are a popular concept. Once you have decided exactly the type of rental you wish to search for, you can begin researching areas and pricing structures, where you will become familiar with the types of lease available and of course costs involved. Deals for renting office space and desk space are hot at the moment. With cash flow being a vital part of business, saving money by going down the route of office rental is definitely a fantastic solution. Feasibility Study Before going ahead with the next step, get together a checklist or a feasibility study. This outlines your business processes and will help identify exactly what your business needs to be able to operate smoothly. Think outside of your business too: Will you have visitors to your office? Is there ample parking? Is the business centre well maintained? Is it easy to find? Does it have disabled access? Are there restrictions on signage used or hours of trade? All of these things can help when putting together a plan of what you are looking for in terms of office space, and of course narrowing things down can help pinpoint exactly the type of property you wish to rent.

4 Different Types of Rentals 4 At this stage you should know just what type of rental you need following planning and research. Whether it s an office for up to eight people, or a huge space that can fit up to a hundred employees, before you sign up to the first office you see take time to research different types of leases available. Shared Offices Usually chargeable on a rolling monthly basis, a shared office is where many different businesses work together; some of whom may hot desk with others. It is an ideal solution for freelancers, start-ups and for those looking for flexible and less costly contracts. This is a short to mid term solution, so not particularly ideal for small to large business looking to expand in the near future. Something to highlight is that although renting a shared office can be an inexpensive option compared to others, there can always be a distinct lack of control in the office. However, shared offices are normally vibrant and buzzing places with meeting rooms, internet connections and security being in place already. Serviced Offices A huge part of the office rental market today, serviced offices offer a premium solution which is ideal for start ups and small businesses. It differs from simple office rental where you are responsible for the management of the whole area serviced offices are controlled by a management team who manage the facilities. They will often provide furniture, reception or telephone answering, IT support, internet connections, post rooms and of course electrics like heating and lighting. Serviced offices are a useful alternative to typical office rental, however they can be more expensive and you have little control over the operation of the office and its décor. Rented Offices Usually chargeable per square foot or square metre, renting office space can be massively cost effective by way of leasing. Though you are expected to have some legal responsibility over how the building is managed and you will be expected to pay for additional bills. Office rentals are a good way to hire space, especially if you already know what you need and how much you want to spend. With offices being available in all kinds of shapes and sizes, it can be an ideal long-term solution. You will need to seek solicitors advice on the commercial lease, and you will face additional costs such as decorating, maintenance, repairs and heating / electric bills. That said, if you are happy to commit to a long-term lease it gives you complete control over how your space looks and how well it is maintained. Sublet Offices A fairly cost effective way to renting your own space, subletting an office is a valuable option for those looking for long-term commitment with control over the office itself. Larger businesses have used this option in the past as a solution for downsizing, and you simply lease the space from the overseeing business or a landlord rather than a property company. So it can be cost-effective for business with a larger budget. You will have control of the décor within your space, however not the building itself so it s worth checking if security is in place and whether the host business arranges cleaning, maintenance and repairs. We hope we have made this as clear as possible by outlining the four different types of leasing available, it should become clear about the best types of rental to look for.

5 What to Expect in a Lease 5 If you have made the decision to hire commercial property or office space, then you should know that leasing, renting and letting are the terms you will come across often. Leases run for different terms, lets list a few that you may come across on your search. Rolling Monthly Some office rentals operate on a rolling monthly basis. This is particularly common in shared offices where they want to offer flexible short-term solutions that are non-committal. If you are looking for small office space and do not know yet what the likely rate of your business growth will be, this type of lease can be ideal and it s often easier to manage cash flow this way. Annual Contracts Longer-term leases are generally better value, but you are unlikely to select this option if you are taking the step from working at home or are a start up business. You are likely to be requested to sign a rental contract on an annual basis, and pay either monthly or annually. This is particularly popular with serviced offices. Long Term Five Years Plus Contracts for subletting and renting conventional office space are long term and usually renewed every five years. For established business or those downgrading from larger or self-owned premises, this can be a good option as sometimes there will be payment breaks or free periods of rental if you are willing to commit to a longer term. The additional investment, such as solicitors fees, insurance and initial overheads can be too much for small or start up businesses and they are an unlikely choice for freelancers. So, dependent on your situation and whether you will upsize, downsize or stay put in the future, the type of contract you expect to sign should reflect your current business, the space required and your proposed growth rate (if known). Office space in central London tends to be expensive, but for those companies with larger budgets it can be the perfect city to locate your business. However, for smaller start-ups, monthly and yearly contracts are more desirable. By taking a look at a wider ranging location, outside of central London or on the borders of the city, you can save dramatically.

6 Negotiating Your Office Space Lease 6 Depending on how flexible you can be, negotiating an office space lease can be hugely beneficial. The more leverage you are able to apply, the more likely you are to negotiate a good solid lease that has your business interests at hear. Another thing to consider is how much the space is in demand are there lots of other companies vying for the space? It s important to read a contract, especially if you are told it s a standard lease contract there s no such thing, and it s likely to be in favour of the Landlord and not the tenant. Carefully read the contract it will give you more leverage when you come to negotiate. Changes to an office lease are less common where the space is desirable to many other companies. If the space has never been vacant before, and you re not willing to pay a good rate of rental, then the chances are the lease won t change. Look out for the following before entering into a lease and signing away your rights, these points are related more to conventional office rentals and letting: Will the landlord pass on maintenance and repair costs to the tenant? Does the tenant expect to have to pay additional taxes should the Landlord choose to sell the property Is the Landlord outlining that he can end the contract early, for any reason? Are there restrictions in place on advertising, signage and control of your office space? If you downsize your business, does the Landlord limit your changes of sub-letting the space? Are you required to return the space to its original state when you decide to move out? With office space being one of the most expensive parts of expenditure you will meet, its important to negotiate well do your research and you might save enough money for an extra employee or take on a lease that is a little less harsh than some! With all types of rentals, look out for the details on: Permitted use of building In most cases, the permitted use may be negotiated so that if your business diversifies, you can sub-let areas or desks without restriction. Maintenance of communal areas The Landlord may wish to pass on the costs on caring for common areas such as break rooms, meeting rooms, toilets and kitchens. You can try to negotiate this part of the contract by suggesting a cap on the amount they can pass to you, or a set fee. Terms of the Lease Landlords will tend to look upon long-term leases more favourably than short term ones. However, you can discuss the possibilities of shorter terms if you are a start-up or small business whose needs are likely to change in the upcoming year. Improvements, alterations and repair Landlords can prevent alterations and improvements being made, or can pass on the costs associated with maintenance and repair to you. An ideal negotiation in this case is to suggest that you are able to make improvements, alterations and repair with the Landlords consent highlighting that the consent should be given within a reasonable timescale. Rent escalations It s usual for the rent to remain a fixed rate for the first year, ideal for the shorter term office leases. However its unlikely that longer term leases will be without escalation as interest rates and operation costs rise. On longer term leases, try to arrange for a fixed rate for at least a couple of years, and that a cap is placed on the following years so you can plan for the price rises. Simply put, make a list of terms that will benefit your business and prioritise them before negotiation takes place. If the Landlord makes unreasonable requests, or is difficult when it comes to negotiating a deal then it may lead you to take up a lease elsewhere. Always ensure that you have a Solicitor you can rely on to check contracts before you sign, who can also assist when it comes to negotiations.

7 Summary 7 We ve put together some advice that we hope you have enjoyed. As a basic guide, we ve simply crammed the main points of looking for office space, and it can really help you on the voyage to growing your business and moving on from a work at home environment, or for larger businesses who need to downsize or upsize to larger but more cost effective establishment. The benefits of situating an office in London really are superb, and it s a central city where you can be proud of the address you add to your stationery! With the five most important things to consider being covered in our e-book, we hope we have gone some way to assist you on your journey and welcome comments as well as requests for further assistance. Costs Location Length of Lease Office Size Types of Rental Our experts put this guide together to cover the basics, however we do feel that for a business embarking on a daunting move into a new office space, it covers the ground necessary to take on that move with confidence. Thanks for reading and do come back to us with questions, or visit our site for more information and to find the perfect office space for you and your business today!

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