Since 2000 the growth in the executive office suite centers has expanded immensely.
Why? Probably due to corporate America dumping its mid-level management teams.
There were a lot of good, smart, energetic and entrepreneurial junior executive managers flushed into the business world in a very short time frame.
To survive, most of them, like me, started their own businesses.
This resulted in the need for single person office space. Where did they turn?
Before Executive Office Suites
In the beginning, they found other larger businesses who had extra offices they were not using and swung a deal to sub-lease one of the open offices. This gave them a place to go every day and get focused on building their business.
Then came commercial real estate brokers like Regis who pioneered the development of clusters of Executive Offices and supplying them with business services. Then, in 2007 came the ‘Flip-Flop Wearing’ tech start-up freelancers who found all they needed was a space on the floor in the lobby to work on their business and BAM..the Co-Working Space started.
The Challenges
Today, there are all kinds of office space arrangements to choose from. But, is there really any advantages to joining into the Executive Office Suite Center business model or doing your own lease with a commercial broker?
Our staff at SyncLab Media has been studying the executive office suite business plan for several years. We have been reviewing the challenges in the commercial real estate since 2013 which gives me, and my staff, the opportunity to dig into several different commercial real estate operations. As a result, we have found some advantages and a large number of disadvantages related to officing in an executive office suite center.
Here are a few Pros and Cons we have discovered.
The Pros of Executive Office Suites
- The single greatest benefit of renting an executive office space is flexibility. A business owner can sign a lease this afternoon and be having their first cup of coffee in their new office in the morning. Generally, suites in an established building are completely furnished, saving you both time and money.
- Office suites can be rented for almost any period of time. A week, a month, a year. Some executive office centers even rent offices by the hour, just in case you need to host a meeting. Unlike the mortgage on an office building, leases are flexible and relatively easy to dissolve.
- Whenever your business is ready to expand, simply rent another adjoining suite or decamp to a larger office suite.
- Network with other business owners in your building to cross-promote, share contact lists and leads, or simply form an informal social club of like-minded professionals.
- Many suites are in beautiful buildings in great neighborhoods and as such make a great impression on clients. The address on your letterhead is hard to beat too.
- Luxury! Most executive suites are modern in style and up-to-date with the newest furniture and stylish lounge areas. This saves you the headache of decorating.
- Fully staffed and bilingual professionals are also a bonus. Most will have front desk receptionists to screen calls, sort mail, and greet guests.
- Location! These usually are in busy areas, which means you get your pick of delicious places to eat on lunch breaks.
- Having a view. Small details like windows and lighting have shown to have an effect on productivity increases and improve upon a Brand’s image to their client.
- How about that struggle to make it past the 2 o’clock crash? A mid-day workout has been proven to not only increase creativity but also boost your energy. Having a fitness center in the same building as the office makes it convenient to indulge in a quick exercise, and makes that New Year’s resolution to hit the gym a little bit easier.
- Bills. Executive Offices provide only one bill for all the services you need for your business. Way better than having multiple bills to keep track of and vendors to deal with.
- Executive offices provide management services, they will take care of any issue that may arise from Phones, internet, Administrative work… you name it.
- Usually, the luxury Executive office spaces will provide Soundproofing in the offices. The cheaper spaces will not.
- If you’re not going through a broker then you won’t have to pay any commissions.
The Cons of an Executive Office Suite
- As a renter, you have no control over the layout, design, and furnishings anywhere in their center. In fact, you may not even be able to bring your own furniture into the office. Nothing in the suite is yours, so you cannot renovate, paint, or dramatically redecorate.
- Signage on windows and doors is mostly prohibited unless a larger office space is leased on a long term.
- Essential facilities such as conference rooms, employee parking, and bathrooms are shared with other tenants. There is usually a high rental fee for additional meeting rooms. Occasionally, this can lead to conflicts.
- Most of the time the availability of client parking space is limited in number and the amount of time a client can park in the space is too short.
- You are always at the mercy of your fellow tenants. If someone heats up their tilapia fish tacos in the microwave, everyone in the building immediately knows about it…for several days.
- If someone fails to clean up a mess, or if a piece of equipment breaks down, you will need to rely on your landlord to fix the problem.
- If one business has a celebration in the common area the other tenants become uncomfortable, especially if they are a competitor.
- Many time businesses that run on the shady side will hide out in executive office suite centers resulting in an uncomfortable atmosphere.
- The environment and atmosphere become toxic when leasing from an executive suite center that has too many of the same businesses office close together.
- Generally, the price per square feet for lease space send operations directors into a frenzy which eventually results in the company needing to justify the value of leasing from an Executive Office Suite Center.
Alternatives
So what are the alternatives for small businesses who are in need of small office space?
If your business is growing and needing more space than an office to sit and look out a window then leasing directly from the property management agent or commercial real estate agent may fit your needs better. Of course, there are more responsibilities involved but you own those responsibilities and control how you want things run.
The advantage to your brand image is immense. Your clients will clearly see you are committed to your business. Having your own office gives off a professional image which improves your brand’s direct marketing appeal.
If you are a business about to make the move from your breakfast nook to an office, think out your options. Executive Office Suites would work for those who just need to get out of the house and not see clients directly. But, if you are like most businesses concerned with their image with consumers, it might be better to take more control of your brand’s image and not let it be affected by the pest control company working out of the office next door.
Let me know how I can help.
