When considering whether to rent an office space, there are many things to consider; one of the most important is the cost. Depending on where in the country you're looking at, and the size of space you need, your costs to rent an office space can vary significantly. Of course, Central London is the most expensive.
When comparing office rental costs, don't just look at the initial price – take into account all the fees and charges that come with renting a space, as well as any potential discounts or incentives you might be offered.
It's important to make sure that the cost of renting an office is well within your budget, and that whatever option you choose won't be too difficult for you to keep up-to-date with payments. By taking the time to research and consider your options, you can ensure that you're getting a good deal when it comes to renting office space.
Work.Life Office
How much should I budget for office space?
The average cost of flexible office space in the UK per person per month is between £200 and £1400, depending on the amenities of the building/space and the location of the building. The costs do not include VAT.
If you are taking a conventional office lease, not a flexible office space, then rental costs will range from £20-150 per sq ft (this is an annual cost).
What costs should I consider when renting an office?
There are two options when it comes to renting an office space - flexible/managed office space or a conventional/non-managed lease. With managed office space, the price is commonly expressed per desk per month and the monthly rates include everything (well almost everything). It will include rent, rates, and service charges. Most commonly with flexible office space, it will also include utilities, wifi, cleaning, and furniture.
With a conventional lease (non-managed) the price will be broken down into rent, rates, and service charges. These costs are expressed as annual costs per square foot. You will also need to estimate the cost of utilities, wifi, and cleaning, amongst other costs.
With both options, it is very important to be clear on what is and what is not included in the price.
WeWork office
What are the ongoing costs of an office?
Annual costs that you should consider when renting an office are:
Rent
Rates
Service Charge
Cleaning
WiFi
Insurance
Registered office address
Filling the fridge!
Access passes (managed offices may charge monthly for extra passes)
What are the one-off costs of an office?
Annual costs that you should consider when renting an office are:
Set-up costs (managed office may charge a one-off set up cost per office or per person)
Deposit (commonly 2-months rent)
Dilapidations/move-out costs
Furniture (normally included in managed offices)
Design and build (if relevant)
AV
What are business rates?
Business rates are taxes that are paid on non-domestic properties, such as shops, offices, and warehouses. Business rates are collected by local authorities and are channeled into local services. The rate you pay depends on the value of your property and the area that it's located in.
If you opt for a fully managed office contract then business rates will normally be included in the rental cost. With conventional office space business rates will be chargeable on top of the rental cost but can be quoted on request.
Dilapidations can occur in office premises that have been leased or rented and are a term often used by landlords. It refers to damage or deterioration of the property due to wear and tear, neglect, misuse, lack of maintenance, or other causes.
What are dilapidation costs?
It is important for tenants to understand their obligations with regard to dilapidations and be aware of the potential consequences. Make sure it is not a hidden cost. Tenants are usually liable for making good any damage or deterioration to the office premises caused during their tenancy. This may include the cost of repairing, decorating, and cleaning where necessary.
Tenants should also keep records throughout their tenancy showing that repairs and maintenance have been carried out as they are obligated to do so under their lease agreement.
What are the costs of meeting rooms?
If you are taking a managed office within a larger coworking space then it is probably that there are shared meeting rooms. The costs of these vary from provider to provider. They may be;
Free to use meeting rooms
Credit system (set credits to use on meeting rooms per month)
Pay per use
What are the costs of meeting rooms?
How much does it cost to refurbish an office?
The typical office refurbishment costs per square metre in 2021 and beyond range anywhere from £45 to £150, depending on the size and the desired amenities. We know it's hard to guess where your project falls within this quite wide range.
To work out how much it will cost you to rent an office, it's a good idea to make a list of potential spaces and compare the prices. By taking the time to carefully consider all of these costs, you'll be able to make an informed decision on whether renting an office is a practical and affordable option for your business.
By following this guide, you should now have a better understanding of how to work out the cost of renting an office. Armed with this knowledge, you can confidently explore the different options available and choose the one that works best for you.
If you need some further advice or guidance, be sure to get in touch with our team of experts; they'd be happy to help guide you through your office rental journey. With their help, you can find a great space at the right price.
