Occupiers of leasehold office space, which had a rent review in the last 2-3 years will in today’s market be paying somewhere around 40% more rent than current market rates, warns Richard Douglas, head of Avanta Property Management, a new division set up by leading serviced office operator, Avanta.
Douglas, the former managing director of Managed Office Solutions, which he founded in 1999 and subsequently sold to Regus in 2006, comments ”Avanta Property Management has been set up specifically to assist office occupiers locked into long term property leases and which have unused space that it may be pertinent to sub-let to improve the financial burden on their bottom line.”There’s a vacuum in the market that’s been created by a mismatch between supply and what potential occupiers actually need,” comments Douglas. ”So, we will address the gap between a conventional lease and serviced office space to the benefit of both current and new office space occupiers.
”There’s a healthy demand from businesses seeking accommodation for one to five years and for between 20-100 people, but these businesses are demanding flexible lease terms as they won’t risk making any long term commitments during the current economic downturn. Such deals are not normally a good fit with traditional agents, who can generally only offer secondary property options.
”However, there’s a lot of Grade A property out there that’s being under-utilised by occupiers trapped in long term institutional leases and we believe that much of this property can be re-utilised to help bring small parcels of high grade property back onto the market. Our proposition will be a perfect fit for existing corporate occupiers which have already made an investment in the infrastructure of a building, which we can help offset by sub-letting. We have substantial experience of working with both occupiers and landlords and our team will handle all negotiations with landlords on an occupier’s behalf.
”Our new service will also prove attractive to larger companies that often consider themselves too independent to move into a business centre, as these often include services they believe they don’t need.
”However, in many cases it´s the office manager who has to take on the responsibility of a major relocation and with no previous experience of such a major undertaking is forced to learn ˜on the job’ where there are potentially major pitfalls. The front and back-end hassles of set-up and re-instatement / dilapidation costs are often not taken into account; particularly double occupancy costs during these phases – which is avoidable.
”We are set up to take the hassle out of all negotiations, both for existing occupiers and landlords, as well as potential new occupiers, and will deliver fully-operational space within six weeks on a build-to-suit basis. In addition, with our user-friendly short-form of lease we can also fast track the legal processes. This is a major benefit to new occupiers who can’t afford to wait months to conclude a traditional lease negotiation which could fall apart at any stage.
The new Avanta division has only been operational for two weeks yet is already negotiating on a number of large occupancy deals, demonstrating the opportune timing of its launch.
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