Growing Supply Of Flexible Office Spaces Is Reducing Costs Across The U.K. Market, According To New Rubberdesk Report

• Rubberdesk is a flexible office marketplace with industry insights from dedicated flex space specialists. 
• Rubberdesk’s recent U.K. Flexible Office Space Report took a look at the cost and availability of flexible office space in key cities outside London. 
• Rental prices for a desk in a coworking space have reached a post-pandemic low of £282 per desk in the U.K. 

Rubberdesk’s recent U.K. Flexible Office Space Report took a look at the cost and availability of flexible office space in key cities outside of London.

London makes up 75% of the available flex office space across the U.K., which heavily skews the monthly rental rates and available space. 

A new supply of flexible office spaces is reducing costs across the U.K. office market

The report revealed that:  

• Rental prices for a desk in a coworking space have reached a post-pandemic low of £282 per desk in the U.K. 
• The available supply was up by 12.8% over the past quarter due to new offices in Manchester, Birmingham and Cardiff. 
• With the exception of Cambridge, office prices per desk are up to 50% cheaper outside London.  

Office space rates are up 7% in the greater Manchester area, while Greater Birmingham is seeing an increase in office inventory

The majority of the office inventory in this area is located in Manchester City, but there are also spaces available in Old Trafford, Salford, Rochdale, Bury and Bolton. The prices range from £525 in Rochdale to £175 per desk in Bury.

After London, Greater Manchester is the second largest market in the U.K. for flexible office spaces.

In Greater Birmingham, rental rates have dropped quickly down to £358 as new inventory has come onto market (rising 25% quarter over quarter).

Office prices in Leeds fall as more inventory is added to the market  

• Rents for office space in Leeds have climbed steadily over the past two years due to a lack of available inventory 
• New supply is now available, leading to a drop in rates to a median rate of £324 per desk 

The future for office flexibility in Leeds looks very positive with flexible office spaces accounting for 15%+ of all available commercial deals over the past year.

Office rates in Glasgow are remaining the same

Space rents and supply have remained relatively steady in the Glasgow area over the past two years, and desks are at a median rate of £332 each.

The majority of current availability of these spaces in Glasgow is focused on smaller businesses that are looking for 1-10 desks, though there are larger offices available for teams up to 50 desks starting at a median rate of £273 per desk in the area.   

Scotland is seeing an uptick in popularity of coworking 

Vacant space has fallen by 7.6% in Aberdeen, and unlike many other markets in the U.K., rental rates in the third largest city in Scotland have been on an upward trend over the past two years and have maintained a high of £300 per desk for the majority of the year.

Edinburgh’s flexible office rates are recovering; after falling to £200 per desk at the end of Q2, median rents increased 12.5% this quarter to £225 per desk.  

Bristol is seeing a 24% drop in vacant office supply 

The supply of available flexible office space fell 24.6% this past quarter due to a flourishing market. Rents are remaining strong, and have risen 1% to a median rate of £303 per desk in Bristol.

Operators in the area outside of Bristol are catering more to smaller businesses across sectors such as technology, media and professional services — with 82% of all available offices for 15 or less desks.    

“Serviced offices operators accounted for 9% of all recent real estate leases over the past half year which should lead to new supply in the Bristol market over the coming year,” according to the report.   

Newcastle sees a 15% increase in office space price 

Unlike many other cities in the U.K., one of the few to not experience a drop in price during the pandemic was Newcastle. Much of its new inventory is thanks to new demand for office space of all kinds.

Rental rates reached a new high of £158 per desk (up 15%). Despite this recent price increase, the rental rates for coworking spaces in Newcastle are some of the lowest in the U.K.

Cardiff is experiencing a decline in rates as more supply becomes available  

Cardiff’s flexible office spaces have dropped 20% since the start of the pandemic to £205 per desk.

Though supply has been limited in the past, the opening of BizSpace’s refurbished Trafalgar House has added over 50,000 sq. ft. of serviced office space.

Cambridge’s office rates are comparable with London’s  

As a university city, Cambridge has historically had a limited supply of available flexible office spaces, and only a few operators have had locations in this particular city.  

Though median space rates in this city have sometimes gone below £500 per desk, the limited availability has quickly pushed prices up consistently. 

With the recent announcement of the opening of the new Fora office early next year, the much-needed coworking space supply will soon be available.

“As a grade A office, it has pushed the median rate above pre-pandemic levels to £650 per desk,” according to the report.