On the face of it, serviced office space seems like a convenient, ideal solution for businesses which need a fully equipped office that meets all of their needs and is ready to use from day one.
If everything is included in the package and you’re made aware of all the costs upfront, it can be a great value solution.
However, there are times when serviced offices are not such a good deal. You may sign up for a serviced office space, believing it to be at a fixed price, only to find that there are hidden costs added on top. It might be that the office provider wasn’t exactly up front about these costs, but on your side – did you remember to ask what exactly was included in the price?
What are the hidden charges in a serviced office? The essential questions to ask
The very first essential question to ask when signing up for serviced office space is how much space you need, as well as which location would be best. This decided, it’s time to think about extras.
To help you avoid getting stung the next time you choose a serviced office, here are the extras you should be asking about:
- Setup costs. This includes everything from phone and internet connection setup to voicemail and administrative setup costs
- Cleaning fees. Believe it or not, some providers of serviced offices charge companies a fee for cleaning the space before they’ve even moved in! Besides this, you also need to ask about weekly and end-of-occupancy cleaning charges, as well as breakage fees. You should also ask how often the office is cleaned.
- Internet usage. Is there a cap on broadband usage? Will you be charged a monthly fee if you exceed this?
- Postage and mail. You will also need to check to see if there are any charges to sending mail. Carrwood Park, for example, charges standard Royal Mail charges if there is no prepaid envelope provided. There is however also a free delivery and collection service so it is important that you are clear about postage charges from the outset.
- Access to conference facilities. Many serviced offices offer clients discounted prices for meeting rooms and conference facilities or even the free usage of such facilities for a limited period. It is important that you are clear about what you may have to pay and any discounts you will be entitled to concerned meeting rooms and conference facilities. And remember, if such spaces were offered completely free it wouldn’t necessarily be a good thing because they would be constantly be filled!
- Access to break-out space. Every hard-working team needs a space in which to relax and enjoy a coffee, but some providers of serviced office space put a charge on access to break-out spaces and staff rooms.
- Refreshments. Are refreshments for meetings included in the price, or will you find these extras on your invoice at the end of the month? It’s worth checking in advance, or these small costs could soon start to add up.
- Telecommunications. You should also ask about calls charges and allowances and any other extras related to phones and telecoms. Here at Carrwood Park, for example, all telephone lines are included but usage is billed. Carrwood charges standard BT rates but other serviced offices charge an additional percentage on top of standard charges. This is therefore something you should definitely ask the centre about.
- Parking. Is parking included in the price, and how many free spaces do you get? If you have delegates arriving for meetings, will you have enough parking or will you have to buy extra spaces?
- Power and electricity. Whilst serviced offices don’t typically charge for electricity, some charge for power and electricity, so again this is something you need to be clear about.
- Special instructions for receptionists or phone answering staff. If you want your receptionist to give callers a special message, or filter out some callers, there may be an extra cost.
- Upgrading. If you plan to upgrade your serviced office contract you can expect to pay more. For example, if, due to company growth, you upgrade from a ten-man office in which you pay £1000 a month to a 20-man office, you could expect to have to pay £2000 a month (allowing for inflation). However, some companies do not charge in-line with previous quotes and may ask for £3000 or even £4000 a month for double the amount of space. It is therefore important to ask the provider about upgrading costs when you are pricing up different companies. (Please note that these prices are just examples and are not based on accurate pricing).
- Renewal hikes. Will you have to pay more when you renew your contract? Some serviced office providers assume that clients will be of the opinion it is easier to stay with them than go hunting for new space. As you will have your branding, address and stationery, etc. with that space, when it comes to renewing, certain serviced offices can bump up the price! However, many serviced office companies, such as Carrwood Park, do not bump up the price when clients renew. Just make sure that it is something you ask about when researching the company.
- Dilapidations. When leaving an office space there may also be charges related to ‘dilapidations’. Dilapidations is the legal term for the necessary repairs and maintenance that is carried out by the tenant, typically at the end of the lease, at the tenant’s expense. Ask the provider about the rules and terms regarding dilapidations before you ‘sign on the dotted line’.
How to get what you want – at the right price
Of course, you need to be realistic in your expectations of what serviced office providers will include in each package. You won’t get absolutely all of the above for the basic price – and indeed, many companies simply won’t need all of these extras.
What you should be looking for is a provider that gives you the option to pick and choose the extras you need, offering a range of flexible packages to suit the needs of different businesses. What’s more, you should be looking for open book pricing and complete transparency when it comes to costs.
Luckily, there are providers that operate such a user-friendly policy when it comes to costs – such as Carrwood Park in Leeds. If you remember to ask about all the different options and extras you need, Carrwood Park will provide you with upfront costs before you sign on the dotted line.
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