There’s a lot to think about when it comes to renting an office space, but at the forefront of any business owner’s mind is the price. The cost to rent office space varies from city to city and from office to office, but it’s good to have an understanding of how it works before you go ahead and sign on the dotted line for a lease.
How much does it cost to rent office space?
So, first things first: how much can you expect an office space to cost? The average cost of rent for a small business is different across the country, so depending on where you’re based in the UK, you may have to factor considerably more into your budget.
London is, unsurprisingly, the most expensive place in the UK to rent an office space, but costs can vary dramatically depending on where in the city you set up shop. Office design company Oktra found that, in 2021, the most expensive part of the city to rent is St James and Mayfair, where rent costs an average of £105-£120 per square foot. Elsewhere in the city, you can expect to pay far less. Hackney and London Fields is the cheapest area, with rents costing just £35 to £42.50 per square foot.
Elsewhere in the UK, office rents are more affordable. In Cardiff, the cost per square foot in Q4 of 2020 was £25; £26 in Newcastle for the same period; £34 in Leeds, and £34.50 in Glasgow.
So if you’re looking for the answer to the question “how much does it cost to rent a business space?” There is, unfortunately, not one clear answer. It depends on your location as well as the type of business you’re operating.
For context, retail premises tend to be far more expensive than office spaces. How much does it cost to rent commercial space? Well, on London’s Bond Street, the cost in Q2 of 2021 was £2,150 per square foot. It was £220 per square foot in Manchester and £95 in Bristol.
Pricing by square footage or number of desks?
Getting a handle on how much to rent a building for business is further complicated by the fact that some leases are charged depending on the square footage of the office and others by the number of desks.
How to understand pricing for office spaces per square foot
It’s the norm in the rental industry to price office space per square foot which is why the figures given above show the average lease price per square foot for commercial businesses. It’s not much help, however, to know that an office space has 10,000 square feet if you can’t visualise what that actually means.
Ideally, offices should be able to accommodate 100 square feet per employee, giving 50 square feet of desk space and another 50 square feet for the space that person will occupy in communal areas like the kitchen, meeting rooms and breakout spaces.
If you have 100 employees, though, allowing for 100 square feet per person could quickly get very expensive, particularly if you’re London-based. Therefore, you may want to consider 75 square feet per person instead.
As well as the space for desks, you also need to consider the amount of room that other spaces will take up in the office. For each additional room, you should allocate roughly the following amounts:
- Small meeting room with space for 2-4 people: 100 square feet
- Large meeting room with space for 4-8 people: 150 square feet
- Board room with space for 15-20 people: 220 square feet
- Conference room with space for 20-30 people: 300 square feet
- Small server room for up to 5 racks: 40 square feet
- Large server room for up to 30 racks: 120 square feet
- Small kitchen: 100 square feet
When you’re looking at office spaces, remember that there may be awkwardly-shaped nooks and crannies included within the floor plan that count towards the square footage but can’t actually be used.
You should also consider what your own office set-up looks like. If you have an open-plan office, then you can take the square footage as a good indicator of how many desks you’ll be able to fit in. However, if you need cubicles or partitions, you may well need a bigger office. You may also need a bigger office than you think if you’re expecting to hire in the near future.
Pricing per desk explained
If you get a quote that says, “it’s a six-person office, and the cost is £1200 per month”, then the company is using the square footage of the office space to estimate how many desks you can comfortably fit in.
Using this example, if the total office space is 500 square feet, then the company has determined that each person would occupy 83.3 square feet, making it a six person office. At the cost of £1200 per month, that works out as £200 per person per month.
Getting creative with the way the desks are laid out in the office can, of course, help you to increase the number of staff in the office and reduce the overall cost.
If you decide that each person, in fact, only needs 50 square feet, then you can go from a 6-person office to a 10-person office, reducing the overheads per staff member.
If you’re looking for a serviced office space with clear, transparent pricing, then get in touch with us here at Easy Offices today. Everything is tailored to your needs – from service terms to our all-inclusive packages.