Serviced Office (Business Centres)
In Singapore, serviced offices are unique and can prove to be a smart choice for companies that are small-scaled. Hoping to avoid big initial costs and benefitting from acceptable lease terms, small corporations often opt to rent a serviced office. Located in the commercial districts of Singapore, serviced offices are managed by experts that cater to the needs of businesses having 10+ employees. Businesses who aim to fulfill a particular short-term task can rent this temporarily.
Who should opt for Serviced Offices?
Serviced offices are best suited for the following businesses:
- Those who aim to move elsewhere on a temporary basis
- Those businesses who have client-interaction as a key element of their business hoping to benefit from a prime business location
- Newly established firms that test markets and avoid focusing on facility management
- Firms requiring additional office space to execute a short-term project
- Those who can expand or arrive at the shut-down point unpredictably
Serviced offices are preferred by new firms, consultancy firms, representative offices and project teams from various industries relating to finance, IT or insurance.
Pros of Serviced Office
In Singapore, serviced offices are preferred by new startups due to their quick availability. They are well-equipped and have all the necessary facilities that are vital to business operations. Services provided by these offices include email support, IT infrastructure, internet & telecom connections, reception services, office cleaning, air conditioning, electricity and lighting, refreshments for staff and other utilities.
There is no capital expenditure required when renting a serviced office and future financial dealings is not an issue as the lease terms are set according to your preferences and requirements. A month-to-month basis can be used to fix rental terms.
Serviced Offices provide facilities such as copying services, seminar/meeting/conference rooms, etc. which can be shared among the tenants. These services normally are acquired by business at high costs which may benefit startups to save these costs. Some serviced offices have ‘hot desks’ allowing several people to share the desk at different times.
In Singapore, business centres are usually situated at the country’s main locations in A-Rated buildings. Therefore, renting a Serviced Office means a prestigious business address for your company. Serviced Offices can open options of flexible growth at the same location, that is, you can take up extra space as you grow. This is very crucial in the initial stages of growth as there is quite an uncertainty prevailing.
Serviced Offices facilitate your staff as well as your clients with several roads, air, and railway connections. Most of the serviced offices in Singapore are located in prime business districts which enables them to be near to major highways and MRT stations.
Cons of Serviced Office
The options available to serviced office tenants come at a high rental price. In comparison to a conventional office, a serviced office may prove to be quite expensive in the long-run. Due to the sharing of serviced office resources among tenants such as conference and meeting rooms, these facilities may not be accessible when you actually need them.
A company locating in a business centre makes it look small and unstable to your clients. Therefore, renting your office in centres may cause your company to be unlisted or listed along with tens of other companies.
Typically, it costs around S$2000-S$3000 per month for a serviced office with an accommodation capacity of 2-3 employees depending on location. In-house facilities such as meeting rooms and conference rooms can be acquired at an additional cost of S$20-S$50 per hour.
When a conventional office is rented in Singapore, it requires refurnishing and refurbishments to be done. Things to do like furniture setting, IT infrastructure, utilities, labor cost, etc. have to be paid by the tenant him/herself. Selecting a conventional office can be a tedious task but if your company is operating efficiently and experiencing good growth rates, you may want to select an office space that best suits your future business requirements. Although an initial capital cost will be incurred, the monthly rental payments would be lower than that of a serviced office.
Pros of Conventional Office
Office space and layout can be modified to suit the specific needs of your business operations. A conventional lease enables a long-term use of the office space without any considerable increase in rent rates. Many lease agreements allow the tenant to renew the lease on the basis of predetermined rates.
Unlike serviced offices, conventional offices can be acquired in different areas of the country. Serviced offices tend to be situated at prime locations whereas conventional offices have a widespread reach. Despite an initial capital outlay (ICO), for conventional office space, the operating costs would be lower than that of serviced offices.
Cons of Conventional Office
For startups, renting a private office space in Singapore is not the best option for you as it requires a 2 years+ long-term lease. Leasing a conventional office space will incur an initial capital expenditure.
A failure to predict the size of your company (in labor terms), you may end up leasing too little or too much space.
Responsibilities would increase in addition to look over office issues like reception, phone answering, mail handling, utilities services, IT setup, and ongoing maintenance, office housekeeping, and so on.
Renting an office in Singapore is one of the key considerations for new business startups. Quick decisions may lead to big future losses whereas a more informed approach may keep the business in a better position. Therefore, first, determine the appropriate type of office rental option for you and then identify the right site for renting your office in Singapore. Don’t base your decision entirely on rent. Pay a fair amount of rent for an outstanding location. Don’t let the lessor dictate all the lease terms.