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UK serviced office market grows 19% during recession

It marks a trend for businesses to introduce greater flexibility into their property portfolios, according to Instant, the world’s largest broker of flexible office space.

The overall number of serviced office centres worldwide continued to rise, generating around US$6.2 billion turnover in 2010, up from US$3.6 billion in 2005 before the global recession hit, proving the resilience of this market. In 2008 the market was worth around US$5.2 billion.

London has by far the largest number of serviced offices in the world at 414, making up 8% of the total, and being equivalent to the combined size of the markets in Paris, New York, Tokyo, Hong Kong and Sydney. The next largest market is New York, with 103 centres.

‘This comprehensive study of the global industry highlights how companies, in a diverse range of sectors, are looking for ever more flexible ways to manage their business and to reduce the costs and risks around their fixed assets,’ said Branton Moore, head of market research at Instant and author of the report.

‘Companies are also looking for convenience to mobilise staff globally, without raising the stakes by committing to long term property contracts,’ he added.

The report also shows that serviced offices account for approximately 80 million square feet of space across the world, providing in the region of 750,000 workstations.
The UK has the most developed market for serviced offices, accounting for one in every three centres worldwide, whilst the Asia Pacific region is the smallest, but is seeing considerable growth as more companies appreciate the advantages of flexible offices and more operators open up in the region.

Regus is the world’s largest provider of serviced offices with a 20% market share and the second largest is Servcorp with a market share of 2%.