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A serviced office is an
office An office is a space where an organization's employees perform administrative work in order to support and realize objects and goals of the organization. The word "office" may also denote a position within an organization with specific d ...
or office building that is fully equipped and managed by a
facility management Facility management or facilities management (FM) is a professional management discipline focused on the efficient and effective delivery of logistics and other support services related to real property and buildings. It encompasses multiple dis ...
company, also known as an office provider, which then rents individual offices or floors to other companies. Serviced offices, also referred to as managed offices, flexible offices, business centers, executive suites or executive centers, are often found in the
business district A central business district (CBD) is the commercial and business centre of a city. It contains commercial space and offices, and in larger cities will often be described as a financial district. Geographically, it often coincides with the "city ...
s of large cities around the world. A serviced office broker will commonly help business center owners and facility management companies to rent serviced office space. Companies offering serviced offices are generally able to offer more flexible
rental Renting, also known as hiring or letting, is an agreement where a payment is made for the temporary use of a good, service or property owned by another. A gross lease is when the tenant pays a flat rental amount and the landlord pays for ...
terms, as opposed to a conventional
lease A lease is a contractual arrangement calling for the user (referred to as the ''lessee'') to pay the owner (referred to as the ''lessor'') for the use of an asset. Property, buildings and vehicles are common assets that are leased. Industrial ...
d office which may require furnishing, equipment, and more restrictive leases. Space is normally flexible, allowing for additional space to be allocated at short notice, should the size of an individual business change. Serviced office providers often allow tenants to share reception services, business machines and other resources, providing reduced costs and access to equipment which may otherwise be unaffordable. By providing businesses with access to a workplace, technology and people central to its operations, the serviced office can be considered a type of
virtual office A virtual office is part of the flexible workspace industry that provides businesses with any combination of services, space and/or technology, without those businesses bearing the capital expenses of owning or leasing a traditional office. Virtu ...
. Serviced offices are a central component to the flexible workspace industry.


History

Pioneers of the serviced office industry in the United States are recorded as early as the 1960s, with the creation of OmniOffices in 1962, followed by the launch of Paul Fegen's furnished law suites for attorneys in 1966. The concept then spread abroad to Australia, where Alf Moufarrige founded ServCorp in 1978, and to the U.K. where the Fuchs family launched a business center in Northampton, England, in 1979, which is still open under their family brand OSiT (Office Space in Town Ltd). During the 1980s, serviced offices in the major US business cities, evolved from law suites into business centers. In the United Kingdom, the concept of working together and sharing premises, staff and other overheads was at first primarily used by barristers. They normally band together into "chambers" to share clerks (administrators) and operating expenses. Some chambers grow to be large and sophisticated, and have a distinctly corporate feel. The advances in computer technology during the 1980s reduced the amount of staff required to operate a serviced office, and increased the technologies a serviced office could offer its clients, including access to computers,
voicemail A voicemail system (also known as voice message or voice bank) is a computer-based system that allows users and subscribers to exchange personal voice messages; to select and deliver voice information; and to process transactions relating to ind ...
, and fax machines. Richard Nissen founded Business Space Ltd. in London in 1980 and was a pioneer of the new digital exchange telecommunications system that used electronics to place and transfer telephone calls. Now primarily virtual offices offering businesses a place, people and technology, serviced offices became an industry. Seminal reports on the industry were carried out by DTZ in the early 2000s, and published with the British Council for Offices. The National Audit Office of the UK has produced a guide to help Government Departments and public bodies to assess the case for flexible managed space instead of conventional office space. In November 2014, a business report carried out by the Business Centre Association (renamed the Flexible Space Association in 2019) showed that serviced offices in the UK are using 70 million square feet of space, house around 80,000 businesses, provide over 400,000 jobs and generate in the region of £2bn to the UK economy. Coworking spaces are a branch of serviced offices that add elements of collaboration and community to the workspace. The term was coined by Bernard de Koven in 1999 and has since become a popular trend for start-ups and international satellites.


Client types

Clients of serviced office facilities fall into the following categories: * New market/locational – Businesses which are typically headquartered abroad or in another region of the country which require a business presence in the area of operation of the business center. *
Startup Companies A startup or start-up is a company or project undertaken by an entrepreneur to seek, develop, and validate a scalable business model. While entrepreneurship refers to all new businesses, including self-employment and businesses that never intend t ...
/ Entrepreneurial – Small to medium businesses or enterprises which don't want to make a financial commitment to a longer term lease. This class of client likely also benefits from not having to add administrative and support personnel to payroll, with all the pursuant HR costs (benefits, insurance, recruitment). * Overflow – Typically a large company experiencing growth, with traditional leased space in the area which it has outgrown. These can be short-term requirements (3–6 months) for large number of users (as many as 40-50). * Interim – Clients that are in the process of moving from one space to another, and may be facing delays in the completion of the new space. * Project-based – Clients that have a specific need for office space, based on a specific contract or project. Examples include
film production Filmmaking (film production) is the process by which a motion picture is produced. Filmmaking involves a number of complex and discrete stages, starting with an initial story, idea, or commission. It then continues through screenwriting, casti ...
teams or attorneys in the
discovery Discovery may refer to: * Discovery (observation), observing or finding something unknown * Discovery (fiction), a character's learning something unknown * Discovery (law), a process in courts of law relating to evidence Discovery, The Discovery ...
process.


Services

Services typically include: * Dedicated
Receptionist A receptionist is an employee taking an office or administrative support position. The work is usually performed in a waiting area such as a lobby or front office desk of an organization or business. The title ''receptionist'' is attributed ...
; * Administrative Support * Telecom service * IT infrastructure and internet connectivity.


Facilities

Facilities typically include: *
Conference Rooms A conference hall, conference room, or meeting room is a room provided for singular events such as business conferences and meetings. Room It is commonly found at large hotels and convention centers though many other establishments, including even ...
; * Meeting Rooms; * Heating,
air conditioning Air conditioning, often abbreviated as A/C or AC, is the process of removing heat from an enclosed space to achieve a more comfortable interior environment (sometimes referred to as 'comfort cooling') and in some cases also strictly controlling ...
and other
utilities A public utility company (usually just utility) is an organization that maintains the infrastructure for a public service (often also providing a service using that infrastructure). Public utilities are subject to forms of public control and r ...
; * Furniture; * Full-time security; and *
Insurance Insurance is a means of protection from financial loss in which, in exchange for a fee, a party agrees to compensate another party in the event of a certain loss, damage, or injury. It is a form of risk management, primarily used to hedge ...


Benefits

Serviced offices may offer benefits over conventional offices for new or dynamic businesses, including: * No / low start up costs * Prestigious addresses * Flexible leasing with little notice (Duration and size) * Building Maintenance is included * Immediate availability * Support staff available as needed * Receptionist * Access to business centres worldwide * Modern fit-out and fully furnished offices * 'Bundled' packages (where one monthly payment covers most costs) are available, as are 'unbundled' (where each item used attracts a unit cost).


Shortcomings

* Many serviced offices (although not all) give a generic, unbranded impression. * In some cases there may be higher monthly cost than conventional leased space. *As the serviced industry adapts to new technologies and services that are available, the terminology also continues to evolve. "Flexible workspace" is a term favored by most industry trade organizations (e.g. Flexible Space Association) as of 2019.


Brokers

A serviced office broker is a company or individual that arranges transactions between a party interested in renting serviced office space and a business centre / office space owner, also known as an office provider. The serviced office
broker A broker is a person or firm who arranges transactions between a buyer and a seller for a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal. Neither role should be confu ...
then makes commission when the deal is made. To fulfil the goal of finding clients to rent serviced office space, a serviced office broker will often do the following: *Find business centres/ serviced office space in accordance with the clients needs and specification. *Request a property condition disclosure form and any other forms that may be needed from the business centre owner. *Request information from the business centre owner in order to describe the property successfully for advertising. *List the business centre/ serviced office space available for rent to the public, often on the internet. *Advertise the business centre/ serviced office space through listings, newsletters, promotions and other methods.


Notes and references

{{Office types Property Office work