London’s flexible office market is diverging, with managed space pulling further ahead on pricing while serviced operators compete aggressively for smaller occupiers.
New figures from Rubberdesk attained by Property Week show managed offices in the capital now cost on average £230 more per desk than serviced offices, equating to a roughly 40% premium.
A Growing Gap in Pricing
Serviced office desk rates declined 4% year on year in Q4 2025. Managed office rates, by contrast, held broadly steady over the same period.
Despite higher pricing, managed supply expanded 5.5% in the quarter, indicating continued operator confidence in demand for tailored, branded workspace with greater fit-out control and more customized lease terms.
The gap is not uniform across London. In Mayfair, the average managed desk rate reached £1,787, almost double the serviced equivalent, creating a 96% premium. Managed rates in that submarket climbed 47.4% year on year, reflecting the arrival of ultra-premium stock. In Holborn, where the managed model is less entrenched, the premium stood at 13%.
Serviced Market Tilts Toward Smaller Teams
While prices softened, serviced offices saw stock contract 7.3% year on year in Q4, as operators focused on filling space and protecting occupancy.
Portfolio composition also shifted. Spaces designed for one to four desks increased 31%, compared with 17% growth in five-to-10 desk units. Supply of offices with more than 10 desks declined, suggesting a strategic pivot toward startups and micro teams.
The result is a two-speed market: managed offices expanding and maintaining pricing power, serviced operators adjusting rates and configurations to attract smaller occupiers.
Flex Strategy in a Hybrid Era
The divergence reflects how hybrid work is shaping decision-making. Some companies are willing to pay more for control over layout, branding and privacy. Others prioritize cost and short-term flexibility.
With managed supply rising faster than take-up and serviced operators competing on price, occupiers may find opportunities to negotiate across both segments in 2026.
