Shared Office Space: The Benefits & Challenges
Posted 3 months ago by TSP
Sharing office space has long been a utopian dream for charities. The opportunity to cut overheads is highly attractive, but historically, issues with confidentiality and safeguarding service users have been a hindrance. Understandably, issues can arise when a children’s charity co-exists with an adult rehabilitation charity. Now, with the rise of flexible hybrid working, new opportunities beckon.
Charities are now looking at having an office or workspace for only one or two days per week. This conveniently eliminates the problem of actively sharing an office on a day-to-day basis. Multiple charities are free to utilise the workspace on different days, rotating as required whilst keeping costs down. A similar set up to hiring a community hall.
Naturally, there are costs and logistics to consider. Like moving in with a new partner, it’s a commitment, occasionally a headache.
What are the options and how does office sharing work in practice? Let’s start with the basics…
What is a shared office?
Shared office space refers to two or more businesses sharing a commercially leased office. While the term can also refer to managed coworking space or a serviced office (think WeWork), it’s generally used when a tenant of a privately leased office rents out their space to another business. This means that both parties benefit from reduced costs including rent, bills and overheads. Quids in.
Types of shared office space
Subletting office space
This is the preferred option for charities. If you have spare office space or only need an office for two days a week, a sublet could be a great option. Affordable workspace for another organisation and a further revenue stream for you. Win-win.
Co-working office space
The most well known being WeWork. These are offices that have been purposefully designed to attract small businesses (mainly start-ups) that want maximum flexibility. Rented on a desk by desk basis and often offering additional services to create a community vibe. Depending on the amenities on offer these options can often be more expensive than the sublet option in the long term.
How does shared office space work in practice?
If subletting sounds like a great option for your charity, the first step is to check your lease and see if you have the optionality to do so (tip: if looking for a new space, make sure subletting is in your agreement so you can be flexible in the future!).
The rental terms of shared office space are decided by the two + parties who intend to share the office. Typically, the main tenant will offer the space fully furnished in line with their current set-up. Most host tenants will use license agreements that grant the space to be used, without providing the tenant protections that a lease does. Subletting tends to offer the flexibility of a short-term agreement rather than the typical multi-year lease and at a more affordable price point. By using a license agreement, the main tenant can simply combine the costs of rent and any amenities on offer into a simple package for the new tenant.
What are the benefits to a shared office?
Costs: As we previously mentioned, one of the main benefits for charities is the possibility of decreasing overheads. As rents rise and people look for a flexible work set-up, sharing an office can be a great solution. You may also be able to share the costs of a receptionist, cleaning and IT services.
Flexibility: If your team size is changing or you have longer-term plans to decrease office-based headcount, shared office space can provide flexibility and shorter-lease lengths.
Who can I share an office space with?
Like any new relationship, we recommend spending some time getting to know your potential partner. Before signing contracts we recommend exploring options and opting for a charity or business with a similar ethos.
The key considerations for office sharing:
- Paper-free office requirements or lockable storage facilities are a must for confidentiality reasons,
- Deciding which days the space is available to each party,
- Deep clean at the end of the day is necessary,
- Office branding may be difficult
But the savings of sharing office space generally outweigh this faff. Don’t forget, as well as saving pennies on rent, utilities and service charge, you can also divvy up dilapidation and repair costs.
At TSP, we’ve spoken with numerous charities currently considering sharing office space. If you ask us, it’s not just a smart, economical option, but the future solution for successful organisations working within a flexible hybrid model.
Through downsizing or sharing an office you can get the balance right whilst transforming the workplace into a sought-after, flexible, and connected space.
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