Flexible Office Space operator Workspace Group has reported that its rent roll is down for Q.2 despite a rise in occupancy levels.
The company has revealed that its rent roll figures fell by 2.9% during the second quarter to £48m despite seeing increased “stability” in occupancy levels. In a statement issued by the company, Workspace Group commented: “Business conditions are challenging but customer demand is good, albeit with flexibility demanded on pricing, which has impacted the company’s cash rent roll.”
The impact of cost cutting to fill space appears to be catching up with the operator which specialises in SME accommodation, as rental values fall amid price cuts. In a report by Inigo Business Centres, published on the Easy Offices news site yesterday, managing director Giles Curtis warned fellow operators of the dangers of participating in price wars. Mr Curtis wrote: “At the end of the day no matter how much prices are reduced there will be same number of businesses opting for our product. In the real world things have a funny habit of going full circle and in this instance all operators will end up with much the same occupancy as they would have had without the price cutting that is going on.”
Price Cutters are Damaging the Serviced Office Industry According to Inigo