Should I lease a seviced office?

[bluepenguin]

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Should I lease a serviced office?

As some of you may know, after 6 years working from home, I’m finally able and ready to move the business out. I’ve been looking for office space in my area, and so far it seems like a serviced office up the road will offer the best location and value. There is not a whole lot to choose from at the moment.

It’s the kind of deal where you get a small, furnished space, a phone and a receptionist. Pretty standard stuff.

The price, location, receptionist and simplicity of everything seem quite appealling to me, as do the many potential clients in the complex, but the fact that I can’t just rock up and make the place look however I want makes me feel a little anxious.

I was hoping some of you would be able to share any experience and advice you may have abut running a business from a place like this.

Thanks.

[Felicity_Sapphire]

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Hi Steve,

I rented a serviced office in Sydney Hills area when I first started my business. I had just finished maternity leave & needed to get out of the house to get into the right headspace to start a business.

I found that it was much cheaper than renting a whole office space. It was also like working back in the office environment again because there were other people around.

I wasn’t able to change the decor, but I could put things on the wall in my office. I can’t complain though, the suites in general looked quite professional. The furniture could be rearranged, and if I wanted to bring in my own, there wasn’t an issue.

After about 8 months, I moved home, but still use their services as a virtual office (phone answering) & use their meeting rooms for client meetings.

The only thing that I found was that there was no directory to be listed on in the foyer. Clients initially would walk around looking for my business, so I ended up telling them that the door to the suites say’s serviced office’s name.

Also, just make sure you get a quote with all costs involved (eg phone calls, tea/coffee facilities, mail handling, etc) as they can sting a little if you aren’t expecting it.

Good luck with your decision.
Felicity

[James Millar]

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Hey BP

We may have a better overall solution in our new facility if you can wait until March next year. We have earmarked a large area within our new premises to house developing SME’s looking for a combination of physical resources and a dynamic collaborative environment (including immediate access to A Grade advisory solutions). We are looking to run the first 12 months as a pilot to accommodate 5 to 10 businesses. The cost will be far less than a standard serviced office and yet will provide more. Location is looking like Camberwell.

There will be a vetting process to ensure that those using the facility are of a sufficiently high standard to lead to potential synergies with all (you don’t need to be the next Richard Branson but you need to have sufficient drive and energy to boost others around you – some of which may learn from you)

We may also be running a business plan competition to kick things off. Top few entrants will get free space, facilites and possibly advisory services for 6 to 12 months. Worth considering. Drop me a line if your interested. It may give you a lot more than just space.

Regards
James

Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900

[GailH]

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Maybe check out the shared office space option as well. Same services, but a bit more social (and often much cheaper).

I know someone who is involved with one of these in Melbourne (http://thecluster.com.au/index/) and it sounds like a great environment.

More and more of these seem to be popping up around the country, so there’s hopefully one close to you.

Cheers
Gail

[bluepenguin]

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Thanks all for your input. It’s greatly appreciated.

James & Gail, those options look really good, however I don’t want to have to travel too far. Camberwell and the CBD are both about an hour away from home during peakhour, so they won’t suit.

I could make more money if I moved to the city, but I reckon the value of not having to sit in traffic/on a train for a couple of hours each day is far more than any amount of extra income I could generate.

The place I’m looking at is 5 mins away.

The area I’m in has one of the fastest growing populations in Australia, so office space is becoming quite scarce, which means the prices are a bit crazy too.

[Corey]

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You need to calculate the advantages and disadvantages of leasing in your local area vs a Serviced Office.

Have you contacted Commercial Real Estate Agents in your area to examine your options e.g. Industrial Unit, Commercial Office Space or even a Residential property zoned for business use?

Cheers
Corey

[rorrock]

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I really like the idea of shares office space, especially where there can be others who you can look at forming mastermind alliances with.

On the other hand, watch for those who offer what are in effect “subsidized” office space. i.e. places that are discounted as they see you more as a potential customer…

One of the best things about being in a space of your own, is the mental process of being “on the job” as such. As well as the social aspect.

Rob

[James Millar]

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I don’t think there is necessarily anything wrong with offering cheaper space (even subsidised or free) with the view of fostering dynamic long term business clients. Provided its not compulsory to take up paid advisory services then its a great arrangement for any small business.

Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900

[trixxta]

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Hi Blue Penguin – I used to actually work for one of the largest serviced office providers in Australia (have since left the business and work for an online retailer now) and the main advice I would have is get as much detail about all the little hidden costs as you can and go through the proposal with a fine tooth comb.

We actually offered a pretty good value proposition – it is easy to underestimate the costs of setting up a new business and the value of having a 100% functioning office set up with cutting edge communications, facilities and receptionists immediately is quite high. The costs you save alone in not having to pay a full time wage to a receptionist are considerable.

However where we made a lot of our money was on things like telephony and internet usage charges, meeting room bookings, receptionist services, faxing and printing etc. Everything is pay per use and you need to keep an eye on everything you do as it can add up. Go through the proposal and ask a lot of questions about every conceivable charge.

There are some things that you may be surprised you will get charged for – like if you receive too many phone calls over a certain limit you may incur extra penalty charges, or long distance phone calls may be charged at exorbitant rates – well over telstras standard rates etc..

That said there is definitely benefits in serviced and virtual offices for certain sizes of business if you are smart about it and I would recommend it.

[bluepenguin]

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Thanks Trixxta,

I ended up leasing a stand alone office on the first floor above a shopping centre. It’s about 6 times the size of the serviced offices, far better suited to my needs and about the same price.

I was ready to sign up for the serviced office because that was all I could find and the deal seemed reasonable. They told me the manager would call me to discuss the contract. It took them a month to get back to me, by which time, I had found my current space, raided Ikea and been up and running for a week or so.

I’ll put the full story up one day when I’ve got a little more time.

[AgentMail]

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Congrats Steve, it is a great feeling isn’t it!

I still smile every time I walk into our office, it was such a big step for us to take, now I look back and wonder how I ever managed without it.

Best of luck with everything

[Author]

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