Background Report on Executive Suite Office Space

Economic Trends Drive Growth of Executive Suite Office Space.

Industry Expands and Consolidates.

An Ohio based CPA firm needed the flexibility of space and lease terms that an Executive Suite Center provides. An Executive Suite Center saves the hassle and administrative time of having to manage a physical facility – utilities, phone, cleaning, maintenance and repair, etc. The availability of extra administrative help as needed saves them from having to hire extra people. A convenient location provides easy access for clients and free parking.

An established lawyer in California uses an Executive Suite Center to maintain a small solo practice. Sharing the cost of the facility with other tenants, allows the business to project a professional and confident image that might not otherwise be financially possible.

A North Carolina based institutional investment advisor needed a West Coast office for business development. Even though there is only one employee, the office needed to function like a multi-employee office. Their needs were met through the use of Executive Suite Office Space.

It was essential that a California based pension consulting and administration firm get started with full office facilities immediately. They wanted an already established clerical staff, phone system, Internet connection, fax, desk, copy machine, and bookcases. Business cards needed to be issued immediately using a permanent address. They did not want to invest more capital in the venture so they found a suitable Executive Suite Center.

These businesses, whose stories are based on real cases, used Executive Suite office space to meet their needs.

Executive Suite Business Centers—the original alternative office—emerged in the late 1960’s. The general concept is this: take a floor in a quality high or mid?rise office building, furnish and equip it like a modern corporate headquarters, provide a professional staff—receptionists, telephone operators, word processors, computer specialists, managers — then provide offices or a block of offices to individual businesses who share the use of common areas, equipment and staff. The concept is also popular in Europe and elsewhere around the world where the facilities are known as “serviced offices.” In the United States, the terms “executive suite” and “business center” are often used.

The cost varies depending on the market as well as on the size and positioning of an office within a center. However, in general, a range from $500 to $2,500 a month is not uncommon in most markets. In addition to the office space, this fee typically includes such basic and necessary services as telephone answering, reception, maintenance and facilities management. Optional services, e.g., document design and production, faxing, couriers, technical support, and mailings, are available a la carte and are billed separately. Some businesses make extensive use of a la carte services, others do not.

Most Executive Suite Centers also offer Virtual Office arrangements. Virtual Office plans provide an address, telephone answering, mail handling and a number of hours of monthly use of an office or conference room, for a modest fee. These prices are generally less than full time office space and depend upon market conditions.

A Virtual Office plan is a perfect complement to a home office or home-based business. It gives a client an address in a prestigious office building, professional telephone answering, screening, and routing as well as the use of a corporate facility when required, while the individual works from the comfort of home. A screaming child or a barking dog is no longer a problem.

Beneficiary of Economic Trends

Traditionally, Executive Suite office space provides businesses with significant benefits:

• A business does not have to expend capital on furnishing, equipping and staffing an office. It can cost well over $100,000 to find, lease, furnish, equip and staff a conventional office operation.
• A business can begin doing its work within 24 to 48 hours after signing a lease or service agreement. Instead of spending the six months to a year it can take to find, design and construct conventional office space, a business can move in with a briefcase, a computer and a few boxes and begin working immediately. Companies often use Executive Suite office space temporarily while building out their own offices.
• A company can use an Executive Suite Center to test a market and build its business before investing time and capital on a conventional office facility.
• An Executive Suite Center provides any business, no matter its size, with the professional image, amenities and resources of a large company.
• An Executive Suite Center can give a small company or small space user an address in a premier office building that it might not otherwise have access to.
• An Executive Suite Center is ready-to-use and available anywhere in the world.

With these advantages, Executive Suite office space has always had considerable appeal especially to startups, entrepreneurs, small businesses and professionals. But in the last five years, the dramatic growth of the global, economy has made Executive Suite Centers the “alternative office” of choice for corporations of all sizes-both full time office space and the virtual office alternative.

The growing interest in the Executive Suite Center Industry has been fueled by recent economic trends. Executive Suite Centers have been in the right place at the right time. The trends:

• Downsizing: (1) As companies reduce workforces, they naturally need less office space, which often can be provided by an Executive Suite Center. (2) Downsized employees, often middle managers, establish their own businesses, which they base in Executive Suite office space.
• Outsourcing: To reduce costs, many companies outsource as many of their operations as possible. Managing real estate is not a core competency for most businesses. Companies are choosing to outsource their office requirements in order to focus on their primary business. They are taking a holistic view of their real estate needs and are re-vamping their portfolio to match their workplace needs with employee headcount
• Pace of Change: To respond to the rapid pace of change in today’s economy, companies must be more agile and flexible. Executive Suite office space is perfectly suited for this environment because they provide ready-to-use furnished, staffed and equipped offices with flexible lease terms. A company can adapt to a changing environment without being bogged down by overhead and long-term leases.
• Growth: The enormous growth of new industries and corporations as well as a competitive global environment, has created an enormous demand for an immediate presence in points around the world. Executive Suite Centers with their virtual office plans are a cost effective resource from which to build these networks.
• Real Estate Market: Previous economic expansions have generally been matched by the construction of new office buildings. In this expansion, this has not necessarily been true. There are some markets, e.g., Boston and New York, where it is difficult and very costly to find conventional space. As a result, Executive Suite office space is the only alternative. In addition, companies are looking to make a “smart recovery” this time around and not repeat the real estate mistakes of the past. Businesses must control costs in the face of increasing revenue to make sure that their growth is profitable. Investing resources in the company’s core business instead of long-term leases is one way to grow profitably. Ready-to-use Executive Suite Centers provide a solution to reducing fixed real estate costs.
• Alternative Officing-the virtual office: Telecommuting and other alternative officing strategies have gained a good deal of support over the last five years. This trend has helped increase the acceptance of the Executive Suite Center and Virtual office plans as another alternative office strategy. Full time office plans are an obvious alternative for employees who would rather work in a business environment than at home or out of a virtual office.
• Advances in Technology: Costly and confusing advances in technology can pose difficult challenges for many businesses. Since leading Executive Suite Center operators generally provide the latest technological innovations, they relieve corporate real estate managers and others from having to make difficult decisions about competing technologies for high speed Internet access. This also gives smaller companies, entrepreneurs and startups access to technology they might not otherwise be able to afford.