Regus, the leading global provider of innovative workspace solutions, today announces the launch of Regus-to-go, a range of ‘office-in-a-box’ solutions for home and mobile workers. Following a highly successful trial period Regus-to-go will be stocked in selected WHSmith stores[1] across the country and online as well as with Office Depot. Regus plans to add further outlets later in the year.
The commercial property market in the UK is likely to bottom out by the end of this year according to experts in the industry. However, schemes which have been put on hold, may not resume construction work until 2011. Developers are not likely to resume building work unless they can get a pre -et agreement secured on schemes. With demand weak, speculative developments are now few and far between.
Business rates in the centre on London are set to increase by a whopping 90%, causing financial worries for occupiers as well as landlords. Under recent government legislation, landlords will have to pay the full rate on empty buildings after to abolition of the empty rate relief. Already coping with falling rents and sluggish demand, agents and landlords in London will be hugely concerned about future prospects.
The recently published annual UK Occupier Satisfaction Index 2009 ¹ depicts the business-world’s general malaise with traditional office landlords and leases.
Whilst recognising that some Landlords have become more flexible, there is an underlying belief that this volte-face has been forced upon them by the recession and that it may not remain when market conditions improve.
Abbey Business Centres believe that many of the issues highlighted by occupiers simply don’t arise for serviced office clients.
Traditional occupiers point to a lack of understanding from their landlords, particularly in these troubled economic times. Downsizing has left occupiers paying for empty space and some landlords still refuse to allow sub-letting. In addition, upwards only rent clauses exacerbate the feeling of ‘them and us’.
The recent increases in BT business telephone rates have further advantaged the all-inclusive business service package, now being offered to serviced office clients of Avanta Manage Workspace, which allows all local and national telephone calls to be made free of charge. “With BT increasing local peak rates by 1p per minute to 5.5pm pm and national peak rates now topping 9.9p pm it doesn’t take too long to run up large telephone bills,” comments David Kinnaird, Avanta’s group operations director. “Most businesses are attracted to serviced office space because of the low total occupancy costs they provide, yet some centre operators continue to charge call costs at these high standard rates either because their own costs are high, or because they are using call charges to increase revenue from their captive client base.
Enquiries for virtual offices have increased markedly on 12 months ago, according to a recently published article from officebroker.com. In fact June has seen a whopping 41% increase in enquiries. There are a number of likely contributory factors as to why there has been such a sharp increase.
Firstly it must be recognised that the virtual office is a great product for companies of all sizes. As the article points out, they are flexible, affordable and allow companies to get the benefits of a prestigious address as well as services such as call handling. All this is available at a smaller cost than renting a conventional office or a serviced office. Additional services can includes meeting room use and range all the way up to database management in some instances. A virtual office can be set up quickly, in many locations across the globe. They are also especially useful if setting up in another country.
Commercial property companies say that occupiers in premium London office locations could face a doubling in property taxes in the next five years. This could then lead to occupiers asking for cuts in the their rental prices as business rates per square foot could shoot from £25 to £50. The values are based on capital values in April 2008. Despite rental prices falling a massive 40% in areas of the West End, the rates will still increase, heaping further pressure on occupiers and agents. For beleaguered West End agents, this is a real body blow, as occupiers will now be deterred from settling in premium London office locations.
Potential investors in commercial property may be seeing the light at the end of the tunnel after two years of dismal economic news. Since June 2007, commercial property prices have fallen a whopping 40%. However although prices have not flatlined yet, they are falling at a much lower rate - around 1.6% a month. Compare that to last year when prices were falling by around 6% per month.
