There is a huge variety of available workspace in London. Native Londoners may well comprehend this diverse choice. However, understandably, businesses from outside the capital may be daunted by the sheer scale of the London office market!
To help clear any confusion, I’m going to get under the skin of the market to show what people are looking for. Fundamentally, there are 3 simple requirements on all our clients’ shopping list: Location, Style and Lease terms.
Fundamentally, there are 3 simple requirements on all our clients’ shopping list: Location, Style and Lease terms.
Location, Location, Location!
Location is critical for recruitment and retention of staff who commute to town from every point of the compass. Typically, locals may be travelling for 30 to 60 minutes (if they are lucky). On the other hand, it’s not unusual for other workers to commute from much further afield. I was recently on a 2 hour train journey returning from a short holiday in North Norfolk. I was astonished to be surrounded by commuters! Above all it is vital to have an office close to good transport communications, namely mainline stations, tube stations, bus routes and safe cycle parking!
Companies used to insist on working in “the right area” in clusters. Solicitors used to love Holborn, newspaper publishers went to Fleet St, ad agencies to Soho, and financial companies to the City of London or Mayfair and St James’s. These days companies are rightly far more geographically flexible and areas that used to be outside “the core” like Euston, Paddington, King’s Cross and Old St have become much more popular.
Style is a reflection of your attitude and your personality
Fashion changes and we find our clients are much more sensitive to good design. There is still lots of “bog standard” space around, but increasingly people want creative office space. And not it’s not just ad agencies & tech companies who prefer creative workspace in London.
There is still lots of “bog standard” space around, but increasingly people want creative office space.
We are working for 2 firms of solicitors who will only look at London workspace with ripped up carpets high ceilings and exposed air conditioning. One firm has just signed a lease in St Chad’s Place in King’s Cross. A really quirky building with a huge open plan studio on the ground floor where solicitors will work in the open. Typically, it has tall windows and hard floors. Notably on an exposed brick wall, they have commissioned a graffiti artist to spray paint something special!
Lease Terms: what are your options?
Historically businesses leased workspace in London on 25 year leases with 5 yearly upward only rent reviews! It was great for the institutional landlords who provided the accommodation on full repairing and insuring leases. They gave all the liabilities to their tenants and sat and watched the rent coming in.
Certainly, large companies still take long leases (10-15 years plus). In contrast smaller companies (i.e. occupiers of less than 10,000 ft2) tend to demand far more flexibility. So 5 year leases are common place and tenants often negotiate early break clauses.
If flexibility trumps all other requirements, companies can lease serviced offices in London for 3 months to 2 years on average and this sector is becoming far more important to London’s dynamic office workscape. Shared workspace or coworking offices are also becoming a popular option for start-ups, where networking opportunities with like-minded businesses are key.
Workspace in London: What else?
I guess there are always 2 additional criteria which are critical in the offices filtering process. Size and cost. If you are interested, you can use our office space calculator to explore these aspects yourself!