The concept of serviced and virtual offices is gradually picking up in Dubai's commercial real estate sector, primarily because of two factors – convenience and financial benefits.
Dubai's commercial real estate sector has been witnessing high vacancy rates since the global financial downturn affected the emirate. However, experts say good-quality offices are still in demand, making it less affordable for start-up companies. That's where the concept of serviced offices and virtual offices gains significance.
Serviced officers are a big draw in these uncertain times but will cost you anywhere from Dh7,000 per month. A virtual office is much cheaper, available from Dh450 per month. Rentals vary according to the size, furniture and client requirements.
At your service
Serviced offices are convenient for businesses when they enter a new market or accommodate new staff in a new city, or as an interim solution while they fit out their own offices. Laudy Lahdo, general manager, Servcorp – the UAE, Bahrain and Turkey, says, “While the commercial vacancy rates are at around 40 per cent in the current Dubai market, A-grade buildings are still rare to find.
“Prominent office space in a prestigious location with first-rate amenities is still in demand by top companies, and one of the main advantages of renting serviced office space is having an office in a great location with flexible lease terms and the size you require. When renting traditional space, the smallest space you can commit to in the top buildings is 200 square metres, which is roughly a quarter of a floor.”
The growing demand for serviced space is attributed primarily to the convenience factor, while is also helps companies save money. Conventional leases can last for ten years, which will bind the business to that particular office even if a company needs to expand or downsize. “As well as flexibility, serviced offices provide businesses with fixed monthly costs, a ‘pay as you use' system for variable costs such as phone and internet connections, business support, cleaning services and even beverages,” says Laudy.
Also, serviced offices are available for a fraction of the cost of a traditional office space in the emirate.
“A prestigious business address is a critical factor in the success of a company. A serviced office allows a business to rent workspace that suits its requirements without the hassle, time or expense of fitting out, hiring, managing and furnishing the space while providing them with maximum flexibility in their lease term agreement and monthly payment structure,” explains Laudy.
Servcorp, for instance, features a team of trained staff who take care of the clients' needs. “One of the most important considerations for a business is the team that will run their business. We have a team of support staff and managers who provide our clients with personalized service so that they can focus on their business,” explains Laudy.
Real benefits of a virtual office
The concept of the virtual office is relatively new, and Laudy says there is a general lack of knowledge about it in this part of the world. As a result, most businesses do not know about the benefits that this choice provides. “The virtual office concept can be a solution for many large national and multinational companies as it can allow for low-cost expansion with no long-term commitment.
“A business can run an advert in another city in the local language and advertise a number in that location and have it answered by our team in that location. Servcorp offers its clients a ‘test the waters' package, which a business can use then entering a new market and take advantage of a prestigious addresses and local telephone number to give them local presence in that market.”
The concept seems to be appealing to businesses looking for a base in a particular city or planning to meet a client in a particular city. “Rather than meeting the client in a local coffee shop or restaurant, owners can make use of the virtual office solution.”
For a small business, it may not be a viable option to have a fully functional office. “An owner of a small business is constantly on the go, whether it is marketing, meeting clients or even closing sales. A small business can't afford to always have someone available in the office all the time, even though it needs someone to be available when clients call. A virtual office can help achieve that, by giving the business a professional, in-house office presence even if the owner is working from home or another location,” says Laudy.
A virtual office basically provides everything necessary to run a business in a professional, corporate setting without the overhead costs that are usually incurred while renting a full-time physical office space. Besides, packages offered are often suitable for clients with varied needs and budgets.
Some of the benefits include agreements starting from one month and access to services such as fully functional IT and communications infrastructure. Servcorp on its part even offers its global network, allowing clients to book meeting rooms, boardrooms, a day suite online or using their iPhone or iPad via their exclusive Servcorp online membership.