By Daniel Soffer, Search Office Space North America
In 2012, the New York executive office market witnessed a notable increase in requirements for larger space. Alongside London, New York has always been at the forefront of the global flexible office market, but it is only recently that we have started to see a trend for larger companies to look at executive office suite space.
The industry had always been associated with accommodating office requirements of one to five persons in square buildings, in order to maximise the building’s space. Now, companies are looking to take 10 person offices, 20 person offices and even entire floors; not just for the short term, but also as a longer term solution.
The flexible market as a whole has continued to expand in New York. We have seen a steady increase in enquiries for executive suites in each of the last five years, and a total increase since 2008 of 61%. Supply is also increasing with a number of new centers having opened in 2012. On average, 15 centers have opened each year in Manhattan over the last 3 years.
The new centers have been a combination of existing operators expanding their portfolio and operators who are new to the market but feel that now is the time to enter the flexible office industry.
Although there has been a clear overall increase in both the demand and supply of flexible office space in New York, it is the demand for larger space that is the biggest indication of an increasingly bright future for the industry. Compared to the first six months of 2011, the first two quarters of 2012 has seen an increase of as much as 18%, in respect to demand for executive requirements of over ten persons.
Inquiries for offices for between 10 and 50 work stations now make up almost 15% of total New York City inquiries received by Search Office Space in 2012. Operators are helping to bring in these larger requirements due to the type of space they have to offer.
There is a new generation of business centers here in New York – and throughout North America – who recognize the importance of creating a versatile working environment, who can accommodate both individual start-ups and Fortune 500 companies with a requirement of 20-50 people. Supply is becoming more dynamic than ever before, and this is great news for prospective tenants.
Familiarity with the executive office model is helping it to become recognized like never before, with larger corporations needing the assurance of flexibility. Our provision of executive offices is now trending and has become more of a serious option compared to long term leases.
As the global executive office portfolio grows in both the sophistication of its designs and the diversification of its facilities, I see an inevitable and continuing increase in demand for high capacity executive offices in the future as companies seek to capitalize on the flexibility and convenience offered by the model.
Daniel Soffer is Senior Vice President of Search Office Space North America. Search Office Space provides a free and impartial executive office search and consultancy service – specializing in executive, managed, virtual and conference suites – guiding clients from their initial enquiry right through to moving day. Search Office Space represents executive suites across all major commercial centres, and can be contacted at +1-888-989-0007 or firstname.lastname@example.org.