Choosing Between Managed and Traditional Office Space

Securing the ideal office space is crucial to support your business needs and future growth. Choosing poorly hinders development and may result in a time-consuming office relocation. As such, it is beneficial to develop a thorough understanding of the key differences between a conventional office and managed office space.

A leased office represents a long-term commitment. Considerable time and effort are invested in an office search, including obtaining approvals, negotiating contracts, and completing additional tasks. The process requires many months before you can relocate to the office.

A managed (serviced) office is completely different. Regal Court Business Centre, as an office provider, offers a variety of offices of various sizes for immediate rental. These private offices are flexible workspace solutions, accessible 24/7, and rented at a fixed monthly rate. The business amenities at Regal Court Business Centre include high-speed fibre broadband, secure Wi-Fi, and a staffed reception area.

To help you choose the ideal office space, let us examine managed (serviced) offices closely before moving on to conventional alternatives.

Managed Offices: An Overview

When considering managed offices versus conventional offices for the first time, it can be confusing for people unfamiliar with the office marketplace. Have no fear – we explain below.

Renting a managed office is simpler, largely stress-free and completed in far less time. For business owners or busy office managers, it is reassuring to know that the office provider makes their lives significantly easier. Managed offices are fully managed, prepared, and fitted-out offices ready for immediate use. They come with furnishings, flooring, connected utilities, cleaning services, and multiple amenities.

The services and amenities provided are particularly significant for tenants. For example, fibre-optic internet is included as standard. No tethering a shaky mobile internet connection while waiting for an appointment date to get the internet connected. It is available from day one, including anyone visiting on-site in the reception and shared areas. IT support is also available, so if an issue develops, the technical staff are ready to resolve it promptly.

The lease contract length for a managed office is typically 3 months in advance, with a 1-month cancellation notice period. Some managed or serviced office leases require a minimum of 6 months. The shorter leases – in months, not years – provide greater flexibility than conventional office leases can offer.

Traditional Offices: An Overview

Conventional office space is rented directly from the building’s landlord. Leased at an agreed rate per square foot, these offices usually come completely bare. While this may be preferable for certain tenants, others may feel overwhelmed and require an experienced office manager to complete all requirements before moving in, which can take many months.

All furnishings must be purchased or alternative arrangements made. Upgrades and maintenance, unless specified in the lease, are the tenant’s responsibility. Utilities require setting up with local suppliers. Any building maintenance must be carried out, other than what is specified within the lease agreement.

Lease Terms and Legal Obligations

Most leases are what is called a ‘full repair and insure’ lease, which means the tenant bears full responsibility for all maintenance and repairs for the duration of the lease. There is also an obligation to undertake any dilapidations – restoring the premises to their original condition – at the tenant’s expense at lease end.

Security is also a major concern. A receptionist for the building might be included, or visitors are required to review a tenant list and visit the appropriate floor. A secure key fob system can be used for all external doors, and floor-level access can protect employees from unexpected visitors; however, this is not typically provided.

IT Setup and Connectivity Requirements

From a technical standpoint, any network wiring, routers, access points, repeaters, and additional equipment that enable employees to access the internal network must be installed. Telephony and internet access require connecting to local telecom providers and being compatible with new phone equipment, computer systems, and networks. An IT team is essential to ensure all equipment functions properly from day one.

Lease agreements fall into 2 main categories: long-term lease agreements and short-form leases. Short leases typically require a minimum duration of 18 months and may still have a 3-year term. Standard lease agreements usually require a commitment of 5 to 10 years to the space and location. In an uncertain business landscape, that represents a significant ask. Lease contracts also require substantial upfront deposits.

Comparing Managed and Traditional Offices

Let us compare a managed or serviced office at Regal Court Business Centre (we use these terms interchangeably) and conventional offices.

In the office space marketplace, they are vastly apart in terms of what you can expect to pay, how flexible they are, their customisability, and any services or amenities provided.

Cost Comparisons

Let us begin with floor space calculations. What amount of space does each employee actually require? A good benchmark ranges between 60 and 100 square feet per employee.

Example: Affordable Managed Office Space at Regal Court Business Centre

Fully furnished office space as a managed office proves very affordable. For example, rentable offices at Regal Court Business Centre range from £637 to £8,220 + VAT per month, accommodating teams from 1 to 60 people across 4 floors. That proves extremely cost-effective per square foot, given that it includes utilities, VoIP telephony, internet access, IT support, cleaning, and additional amenities. The deposit arrangement varies depending on the specific office, but typically requires 3 months, with a 1-month notice period.

Traditional Office Costs and Fit-Out Expenses

Leased office space in London often requires a deposit equivalent to 3 to 6 months’ rent. Monthly rents per square foot in London range from £25 to £45 per square foot for Grade A or B office space in developing areas, rising to £75 and £100 per square foot in popular locations such as Covent Garden, North Oxford Street, Clerkenwell, and Farringdon. Fit-out costs can range from £100 to £250 per square foot for new tenants.

As you can see, managed offices are more cost-efficient. This is especially true considering the bundled services, which simplify calculations and remove variability from budgeting. Few businesses can reach an economy of scale where renting a large office building begins to make financial sense.

Legal and Setup Costs: Managed vs Traditional Leases

Managed offices are ready for immediate occupation, and the provider will usually have a standard template licence agreement that is easily understood by your solicitor. While there may be a small administration fee to establish the licence, it is typically very reasonable. By contrast, a conventional lease will involve two sets of lawyers billing hourly to agree on the format and complete the lease, with the landlord’s legal costs often paid by the tenant. You may also need to cover surveyor costs to agree on a formal schedule of dilapidations. This legal and professional involvement represents a major source of both expense and delay in the leasing process.

Potential hidden costs in conventional offices surprise many newcomers. Maintenance and repair costs can be unpredictable. Insurance and property taxes are additional charges. Additionally, service charges, business rates, and early exit fees can prove frustrating. Managed offices completely avoid most of these concerns.

Flexibility and Scalability

A managed office is typically offered on a lease of 3 to 6 months. Companies can effortlessly scale their offices up or down based on current performance and future growth expectations. For example, Regal Court Business Centre has managed offices for 1 to 60 people, depending on current availability. Their flexible terms and scalable ability are major benefits for business operations that require ultimate flexibility.

Conventional offices come with multi-year lease agreements and require months before tenant occupancy. This allows for minimal flexibility in office size or for supporting the expansion or contraction requirements of a business. For dynamic businesses, managed offices are often a superior option.

Control and Customisation

Managed offices offer reduced control over office design, office layout, and potential branding opportunities. Typically, offices are furnished and come fully equipped. Some office suppliers are willing to discuss which furnishings are provided, subject to current availability. This represents the compromise.

Conventional offices allow tenants complete control over fit-out, office layout, furnishings, lighting, and almost everything else. This comes with financial responsibility for all elements, including their replacement and ongoing maintenance.

For businesses requiring control and customisation, some of their office spaces may remain conventional. However, other office spaces that do not require this level of customisation lend themselves to the serviced/managed office approach.

Location and Accessibility

Prestigious office locations enhance corporate image; unflattering locations detract from it. Overpaying for skyscraper views and marble floors in reception areas hurts the bottom line. Perception matters significantly in location decisions, yet modern business centres deliver excellent aesthetics for tenants and visitors alike.

Accessibility for people with disabilities is very important. Older buildings struggle to cater appropriately. Companies have legal responsibilities to consider in this area. Managed offices are often newer builds that are better equipped to fully support everyone’s requirements.

Managed offices best support location flexibility. A conventional office lease typically locks tenants into the same location for many years, whereas managed offices only require a few months in one location.

Services and Amenities

Common managed office services include:

• Reception services during business hours
• Mail handling services
• Utilities provided
• VoIP telephony access
• High-speed fibre internet
• Kitchen and breakout areas
• Over 100 parking spaces, bicycle storage, and EV charging points
• Professional cleaning services
• Security systems, e.g. secure 24/7 access
• Building and grounds maintenance

With Regal Court Business Centre, security is ensured via secure 24/7 access to the business centre. In addition to breakout areas with kitchens, our offices are strategically positioned on Slough High Street, just a short walk from Slough train station (17 minutes to London Paddington), with convenient access to major motorways (M4, M25, M40).

Conventional offices offer either no services or the absolute minimum. This hampers business operations, especially during the first months of a new tenancy, where time is lost addressing additional issues.

Value-added services with managed offices may include organised networking events for local businesses. Shared areas enable a mix of tenants to discuss their work, socialise, and potentially collaborate on new ventures.

The Regal Court Business Centre Advantage

Complete Business Solutions for Modern Entrepreneurs

Choosing managed office space delivers strategic advantages that extend far beyond basic accommodation. The financial benefits alone make a compelling case – instead of tying up substantial capital in furniture, technology infrastructure, and utility deposits, businesses can redirect funds toward revenue-generating activities. Our transparent monthly pricing eliminates unexpected costs and simplifies budgeting, while flexible lease terms protect against long-term commitments that may not align with evolving business needs.

Operational efficiency improves dramatically when administrative burdens are removed. Professional reception services enhance your corporate image immediately, while integrated IT support ensures uninterrupted productivity. The diverse business community within our centre creates natural networking opportunities, fostering collaborations that can drive growth and innovation.

What to Consider

Evaluating Managed Office Suitability

While managed offices offer substantial benefits, careful consideration of your specific requirements ensures optimal decision-making. The primary trade-off involves customisation limitations – managed spaces restrict extensive modifications, unique branding implementations, or highly specialised work environments compared to conventional leases, where complete design control exists.

Financial evaluation requires a comprehensive analysis. Although managed offices typically provide superior value when all services are considered, the apparent per-square-foot cost may exceed basic conventional office rent. Assess whether your business thrives in collaborative environments or requires complete privacy and specialised security arrangements.

Consider scalability requirements carefully. While managed offices accommodate growth or downsizing effectively, businesses planning rapid expansion beyond their facility capacity should evaluate conventional options that offer more predictable long-term space availability.

The Case for Managed Offices

Managed offices enable new businesses to scale up or down, or relocate quickly and efficiently, as they pursue their objectives. While conventional offices have their place for large corporate clients, they prove overly restrictive and limiting in rapidly changing business environments.

Professors teaching business at university level often correct students when they are asked about the main objective of a business. Staying in business takes precedence over profit, philanthropic goals, and other concerns. The managed office model supports this by allowing far greater control and flexibility over office expenses and lease durations. The ability to grow with expanding markets or cut costs in contracting ones, each has its place.

Conventional offices often constrain entrepreneurs inappropriately, resulting in higher expenditures when costs must be reduced. These put added pressure on employee headcount – staff the company must retain to survive sudden downturns. Making well-informed decisions about office space allows businesses to navigate slow periods and emerge successfully on the other side.

Conclusion

Both managed offices and conventional offices have their appropriate place.

Managed offices are more affordable, easier to manage, and come with extensive services and amenities. Their lease terms are more favourable, with 3 to 6-month leases being common. Deposits are often 3 months, with minimal time required before moving in.

Leased office rentals require time to locate, negotiate, fit out, establish, and move in. Lease terms typically range from 3 to 5 years, with durations of 5 to 10 years more common. Unlike with managed offices, the office layout and customisation options are entirely up to tenants. However, that all comes at a steep price and substantial delays.

When looking for new office space, consider all aspects. We are happy to discuss your specific requirements and book a tour of our managed office facilities at Regal Court Business Centre. Please contact us at info@regalcourt.co.uk or call 01753 910 900 to see how we can help you.