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Office rental agency or direct? Which is best when renting an office in London?

Office rental agency or direct? Which is best when renting an office in London?

When you are looking for office space, you have many choices including how you rent it. You can do so directly from the provider or use an agency. This guide will show you the differences to help you choose the best way for your business.

Office rental agency or direct? Which is best when renting an office in London?

 

What is an office rental agency?

An office rental agency advertises office space on behalf of providers using its agents, who are also known as brokers. They are paid by the owner of a property to find suitable tenants on its behalf. An office rental agency is responsible for advertising the property and finding then filtering applicants, with the owner of the property making the final decision on who can rent it. A broker earns commission from the space they successfully lease.

How does an office rental agency differ from a property management company?

Once a broker finds a successful applicant that rents the office space, their part in the process is complete and they return to advertising other spaces and finding new customers. 

A management company remains engaged with the customer during their tenancy, helping them with any issues that arise. They will act on behalf of the property provider to manage things like repairs, rent collection, issuing contracts or important changes in writing, and other similar services

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What does a direct office space provider do? 

It may seem a little obvious, but a direct office space provider supplies office space directly to its customers. They do a little more than this, obviously, conducting advertising and organising property tours for potential customers, then negotiating or offering lease terms. The company providing the space also manages the facilities on site, manages the lease terms, and supports its customers while they rent office space from them. 

Direct office space providers come in a wide range of shapes and sizes, some offering furnished space or extras like a gym or cafes serving homemade sandwiches and flat whites. Because they don’t involve an agency, they don’t earn commission, instead they make money directly from the lease. 

Should you choose direct or agency?

You’re busy, we get it, and getting through the process of leasing the perfect office can be a lot of work. Searching for spaces that satisfy your requirements, setting up and attending property tours, conference calls or face-to-face meetings, and negotiating the terms of the lease, you could hand all this over.  

But there is something to be said for being in charge of your own destiny and a broker may not be the right option for you.  

Should you choose to use an agency or do the work yourself? Let’s look at some pros and cons. 

Pro: Using a broker from an office rental agency will mean they do some of the work for you, making the process simpler and saving you time, which in business, equals money.   

Con: However, if you aren’t looking for a particularly complex lease or larger space, going directly to the provider may be simpler. You gain more control as you are involved in the process to a greater extent. 

Pro: Brokers are experienced. You may only conduct a lease transaction once every few years, brokers do many deals every month. They may know more about the landlords operating in the local area, which they use to your advantage. 

Con: An office rental agency will work on commission, so there is a financial motivation for your lease term to be longer or more expensive to increase the commission.  

Pro: A broker or agency may be able to work out a lease agreement that works best for your company’s financial needs or negotiate specific terms for increasing space down the line. 

Con: Working solely with an agency could limit the properties you are shown. They may even be motivated to point you in the directions of their own agency's properties to receive the maximum commission.  

Remember that the final decision is always yours, whichever way you choose to access office space. remember the important aspects of selecting the space including calculating how much space you will actually need, designing the office for productivity, and sticking to you budget.  

To help you get started, use our handy space calculator

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You can also discover more articles like this one on Workspace’s Content Hub, including how to create the perfect office. Find out more about our customers and their spaces too. 

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