How Much Is It To Rent Office Space?
London office space is some of the most expensive commercial real estate in the world. That may be a daunting statement if you are looking for new office space to establish or expand your business, but the headline numbers can hide some of the more affordable options hidden around the city.
How much does office space cost in London?
According to Statista, the cost of office space in London has been rising overall in the last five years, but this depends on where you are looking.
West End prices have seen a strong upward trend since 2019 and even increased during 2020 when the Covid-19 pandemic was at its peak. At the end of 2023 prices had reached over £150 per square foot.
Canary Wharf and Docklands office rents dipped slightly between 2019 and 2021 but have recovered since, and ended 2023 just over £50 per square foot.
Southbank and City office prices have seen small increases since 2019, with office space on the Southbank now averaging £70 per square foot (up from £67.50) and space in the City increasing to £75 from £70 per square foot in 2019.
Location |
Office Rent 2019 per square foot |
Office Rent 2023 per square foot |
% Change |
|---|---|---|---|
Canary Wharf / Docklands | £48.50 | £52.50 | + 8.2% |
City | £70.00 | £75.00 | + 7.1% |
Southbank | £67.50 | £70.00 | + 3.7% |
West End | £112.50 | £150.00 | + 33.3% |
Electric Works N7 has a range of office space available, with prices ranging between £26 to £37 per square foot, and units available from 323 square feet up to a huge 9,311 square feet.
Electric Works N7 is located almost next door to Holloway Station on the Piccadilly Line. Holborn is only 5 minutes away, and Piccadilly Circus is less than 10 minutes away by tube.
How much should I be paying for office space?
Knowing how much it costs to rent an office can be a tricky question to answer. Exactly what you need will depend on your type of business, your staffing, how flexible you need the space to be, and the length of your lease, among other things.
Here are some of the most important factors to consider:
How much space do you need?
How much office space you need per person can depend on the type of business you have. You will need enough space for your staff, desks, computers and any other equipment or furniture your business requires.
You may need to factor in enough bathrooms and kitchen space too. We have answered the question how much office space you need per person.
Do you need a flexible working space?
If you can make use of a flexible working space, you may be able to run your business without all your staff members present at the same time.
If you have staff who job share, or some who work from home for a few days each week, or rotating schedules of who needs to be in the office, you can get away with less space than you would need if everyone needed to be on site at the same time.
Would a coworking space suit you better?
A dedicated office space is a fantastic option for an established business. If you are still in the early stages of your start-up, and don’t need or want to commit to a full office lease yet, then a coworking office space might be perfect for you.
How long do you need the space for?
Are you looking to sit tight and grow your business, or is this location only a temporary measure? Maybe you are between offices and just need a home for a few weeks, or perhaps now is the time to put down some business roots and establish yourself in the local area.
Most office leases last several years, so if you have the budget and plans to commit to a long-term lease, you can secure peace of mind and continuity for your business. If you need something shorter term, or with more flexibility, then one of the options mentioned above might be worth considering.
How much does it cost to rent office space?
We have seen above how the cost per square foot for office space in London, even for a small office, can be very expensive, but it depends where in the City you need to be.
But the price to lease an office is not the only cost you need to consider. Here are some other costs you need to be aware of:
- Deposit: Much like a residential lease, you will probably need to pay a deposit in addition to your commercial rent as a form of security for the landlord.
- Service charge: A service charge is common in addition to your lease. Your lease includes the rights to the property in question, but the service charge will cover additional services and upkeep needed by the building or wider area maintained by the landlord.
- Fitting out: Make sure you leave room in the budget to fit out your new space. This includes flooring, wall coverings, decoration and other treatments, branding, furniture and equipment. This is your chance to make the space your own, so take the time and effort to turn the office into a home for your business.
- Business Rates: These are the contributions that local businesses make to local services, just like how council tax covers the cost of local services for private residences. Electric Works N7 falls within the boundaries of Islington Council, and you can find more about Islington’s business rates here.
- Insurance: You should always make sure you have the correct insurance to protect your business. What you need will depend on the services you provide and who is involved, for example, if you travel to customer’s premises. Public Liability Insurance, Professional Indemnity Insurance, Business Interruption Insurance and Business Contents Insurance can all be priceless if disaster strikes. Speak to a professional broker for more advice about what is right for your business.
- Utilities: You will need to pay for the basics to ensure your office is fit for purpose. This means water and electricity and an internet connection at minimum. If you want to play music in the office, you will need the proper Music Licence from PPL PRS Ltd.
- Legal costs: You should always consider professional legal advice when committing to an office lease. You will have to budget for the legal costs themselves as well as other incidental costs, such as Stamp Duty Land Tax and Land Registry registration fees.
How much can you save with the right office space?
There is a lot to consider when it comes to the cost of leasing an office, but location is everything, and that can come with significant savings, too. Do you want to overpay for a glamorous postcode when all the benefits of City and West End locations are only minutes away?
The money saved on rent can more than cover the cost of Oyster Cards, rail fares, cabs, Ubers, local entertainment, dining out, team building, better equipment, and anything else you can think of.
Find your perfect office space with Electric Works N7
Electric Works N7 has a range of units available for around £35 per square foot, which is almost a third of the average London office rent, based on our table above.
With a variety of units available, great travel links and plenty to do in the local area, get in touch today to find the perfect office space to rent for your business.