Carried out in 2014, their research shows that serviced offices have once again increased in number throughout the UK, rising by 3.6% overall, with the biggest focus predictably in London.
“The market in London continues to outperform others across the country, with Greater London now comprising 30% of the national market,” says Instant. “Central London, the City, West End and Southbank have all seen serviced office centre growth of over 10%.”
That growth has also seen an increase in rental values, with average rates in London having “risen beyond levels previously seen at the height of the pre-recessionary market in 2008”.
Instant reported that workstation rates reached £1,500 last year.
However, that’s not to say regional locations throughout the UK aren’t faring well.
Instant found that “nearly all of the UK’s largest markets have experienced growth” with respect to new centres, along with corresponding increases in average workstation rates year on year.
According to the report, Manchester has seen an increase in serviced office capacity of 9% with workstation rates increasing by 5%.
Aberdeen, Bristol, Glasgow, Edinburgh, Belfast and Cambridge have also shown “significant increases” in both serviced centres and desk rates compared to previous years.
That said, Birmingham and Oxford have been singled out as “examples of the limited exceptions to the general trend, where service centre growth has not necessarily been matched by increases
in workstation rates”. The report found that rates in these markets have dropped by 0.1% and 11.6% respectively.
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However, the overall flavour is a positive one. And while competition grows sharply, it seems the serviced office sector is continuing to nudge into the conventional market. Instant reports that 51% of contracts signed last year were for an initial 12-month term.
“We have noticed an increasing trend for some corporate clients to secure serviced offices,” the report claims, with indications of “widening and increasing acceptance of serviced office solutions within the corporate sector, ranging from SMEs and mid-caps through to FTSE 100 /Fortune 500 companies.”
The report concludes:
“In short, the UK market is becoming more sophisticated and mature, and clients appear to be embracing this evolution. From a market report perspective, this does however make the production of average workstation rates for the different regions more difficult to interpret as a consequence of the increasingly varied spectrum of serviced office choice in each location.
“By way of general summary, with the economic recovery beginning to take hold across all regions and an increasing awareness and acceptance of serviced office solutions, the sector appears to be well placed to benefit from continued growth across the country in 2015 and beyond.”
View the full report here:
Instant Serviced Office Review 2015