Office politics

5 April 2007

Given all the challenges entrepreneurs face - from getting the product right to securing finance and building a team - finding office space should be the least of their worries. Too bad, then, that it's often a big headache.

London-based start-ups have particular reason to worry. According to this year's DTZ Global Office Occupancy Costs survey, the capital's office rental costs are the highest in the world. Out of 131 business districts worldwide, London's West End tops the league for the seventh successive year, with occupancy cost averaging $23,260 a year.

And if you're looking for space, suitable doesn't just mean affordable. Even if you manage to track down something reasonably-priced, you're likely to be deterred by a lease that ties you and your unborn children into servitude well past your planned retirement date.

But the good news is that if you look around, you'll find a growing number of options for start-ups. Flexible, affordable workspaces have long been available from outsourced space providers such as Regus, which has been in the business for nearly 20 years. They're now being joined by newer companies like easyOffice, the latest venture from Stelios Haji-Ioannou. From easyJet to easyJobs, Stelios has a reputation for shaking things up, so expect a bit of a stir when easyOffice opens its first outlet in Kensington. It will offer one- to four-desk rooms for hire by the week - and as with his airline, they're priced to favour those who book online and early.

If you prefer not to leave the office for an informal chat over coffee, it might also be worth looking at the Coffee Lounge, a Canadian venture with an outlet in central London. Marketing itself as a 'business club with a gourmet café', it offers members a blend of free wifi, business centre services, conference rooms, mailbox, and different sized offices available for rental on a monthly basis.

But the office space super hero must be Habitaz, a company that has brought Oyster Card-style flexibility and accessibility to renting office space. With Habitaz's pre-paid GreenCard, customers can rent space and facilities - including open plan workspace, admin support and phone calls - by the hour, minute or megabyte and charge them to the card. Real-time online billing helps customers keep track of their costs and, when the card runs out of 'GreenBucks', it can be topped up.

Sadly there's a catch. Habitaz is a South African company and is focused on developing its network of business centres and work spaces in South Africa and the rest of Africa. Still, maybe there's an opportunity for a London-based entrepreneur to launch a similar scheme over here...?

By Alison Hjul, Webster Buchanan Research