The big three – leased, serviced and managed office space - what are they and how are they driving the flex office market?

Today, flexible office space has become a central element of many companies' real estate strategies, offering much-needed adaptability and variety beyond traditional “leased” properties 

We typically talk about options falling into three main categories - serviced, managed , and leased offices. The newer categories of serviced and managed properties are driven by the flexible office sector, providing an increasingly comprehensive variety of solutions, from corporates and larger established businesses, to SMEs and start-ups. 

To help navigate these options, Workthere has provided a simple guide to these three main types of office space available. 

Leased offices  

Leased offices are the conventional work environment we're accustomed to. Leased office spaces involve long-term agreements with landlords or other tenants, typically lasting three years or more. These offices are private, self-contained floors or entire buildings that the tenant designs and manages. While subleases and assignments offer shorter terms, it’s important to note that flexibility to scale can be limiting.  

Tenants are responsible for all costs, including rent, business rates, service charges, utilities, and maintenance, along with fit-out and dilapidation expenses, legal and agency fees. One of the benefits of covering all the costs is that you will have full permission to incorporate branding within your workspace and in the reception area. However, facilities are not included in the rent and there are no shared amenities as such, so everything your business requires must be within the office suite.  

Due to the structured nature of leased offices, they are typically ideal for companies seeking a stable, long-term workspace tailored to their specific needs. 

Serviced offices  

Serviced offices are workspaces that are managed by an office provider offering everything from small private offices on shared floors to self-contained floors within larger buildings. These offices are fully furnished and typically ready to move into straight away, saving considerable time and effort. Contracts for these types of spaces can vary from a monthly basis to three years, providing flexibility to upsize or downsize as necessary.  

Costs are all-inclusive, however, legal fees, if applicable, are the tenant’s responsibility, whereas broker fees are covered by the landlord.  Tenants also have the options to take space as is or opt for a bespoke fit-out, all included in the costs. Branding options are more limited compared to a leased office, but you can still include your company branding within your suite. In a serviced office scheme, you'll have access to shared amenities within the building's wider facilities, such as breakout spaces and meeting rooms, which are maintained by the operator. Take Fora, Chancery House for instance, this office space is loaded with a wealth of amenities such as terraces, a café and end of trip facilities, all at tenants’ fingertips.  

Serviced offices provide businesses with the agility they need due to flexible leases and space options, making them perfect for companies that require adaptability to changing needs. Although historically popular amongst start-ups and SMEs, this type of space has taken off with larger companies looking to adapt.  

Managed offices   

Managed office space is a combination of serviced and traditional leases, providing private, self-contained floors or entire buildings designed and managed by a third party. Managed offices are fully equipped with all necessary amenities, such as meeting rooms and kitchens. However, unlike serviced offices, these facilities are private and not shared.  

Contracts typically range from one to five years, offering similar flexibility to that of serviced office space, allowing your business to scale up or customise the space as desired. Tenants are also permitted to include branding within their suite and also the reception area. Costs are all-inclusive, with legal fees the tenant’s responsibility and agency fees covered by the landlord.  

Managed offices are ideal for businesses seeking a flexible, long-term, self-contained workspace without operational hassle.  

In summary, each office solution caters to different needs. Leased offices provide long-term stability and control, with all operational costs handled by the tenant, suited for companies seeking a permanent base. Serviced offices offer flexibility and all-inclusive costs with shared amenities, perfect for those requiring short-term adaptability. Managed offices blend traditional and serviced features, providing private, self-contained spaces with long-term flexibility and all-inclusive costs, ideal for businesses needing a stable, customisable workspace. Choosing the right option depends on your business’s specific requirements and growth plans.  

As the flexible office market continues to gain traction and evolve, we are expecting even greater diversity in its offering. Traditional leasing units are becoming more adaptable, offering shorter terms and customisable options to compete with newer models. Day booking apps, such as NearU and Desana, are expanding the concept of flex by allowing users to book spaces as needed, and some providers are offering part-time office solutions. As demand shifts, we anticipate new products will emerge ensuring the market and its users remain responsive and innovative.