I take pleasure in sharing our Central London Office Rental Guide updated to December 2023. This shows approximate costs for renting offices all over Central London.
Read this at your leisure, but in the meantime I wanted to discuss a growing trend in the longer term leased office market for landlords to provide furnished and ready-made fitted offices.
How it’s worked in the past
Until recently, a tenant taking leased offices would be provided with a great big empty space by the landlord. It may sound strange, but when they get space back from a departing tenant it is still normal for landlords to operate the old fashioned “one two shufty dilapidations manoeuvre”:
- Strip out redecorate and make good (or more commonly get the old tenant to strip out) the office, to include old partitioned offices, meeting rooms, kitchen, break out areas, comms etc. You get the idea? And all at the departing tenants cost!
- The landlord will then market the floor as a large redecorated empty space.
This leaves the new tenant having to spend the first 3 months of their new lease fitting out the same space again. Landlords and fit-out companies love this. But this process often takes little account of the tenant’s needs.
Many tenants prefer to take ready fitted out and furnished space. This can save time, money and avoid the anxiety of embarking on an interior design and build project.
It’s fair to say that some tenants have precise ways they want to design their new office and they may be delighted with the opportunity to “stamp their identity” on their new digs. But many other tenants would far prefer to take ready fitted out and furnished space, but do not want to take the serviced office route. This would them save time, money and avoid the anxiety of embarking on an interior design and build project.
Back to ContentsReady-made fitted offices in the longer term lease market
Hence the birth of the Fitted Office! And when you think about it, it’s so obvious. The truth is that most tenants (especially of smaller offices of say 1000-5000ft2) have very similar space requirements. A furnished office providing an open plan area, kitchen, break out, meeting room(s), fast internet connectivity and – well that’s it!
So we’re coming across an increasing number of fitted and furnished opportunities in the longer term leased office market, where tenants commit to take space for say 3-5 years. Although they typically cost more rent (perhaps another £5.00 – £7.50 per ft2), the additional cost is spread over the period of the lease.
A ready-made fitted office is often much less than the cost (and agony) of having to fit out an office, only to have to rip it all out again at the end of the lease. Simples.
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Ian Kitchener
Ian has advised Central London office occupiers for over 20 years - fighting their corner and making sure they get a great office on the best terms. He has a diverse client following, often working with creative companies.
