A special interview with our US VP, Daniel Soffer (Part 2)
As part of our US Markets series, we asked our own US Vice President, Mr Daniel Soffer, to share some of his personal insights, and try to determine where the serviced office market is headed next.
Daniel Soffer is the Senior VP of the Americas for Search Office Space, and is based in our New York headquarters.
He joined in 1999 as a junior consultant, and has seen real results from his hard work. Progressing to Sales Director in the mid-2000s, Daniel eventually moved Stateside to help the company expand further. Daniel’s efforts have proved once again fruitful, as Search Office Space continues to grow in the Americas, and globally.
[caption id="attachment_15716" align="alignright" width="300"] Daniel Soffier, Senior VP of Search Office Space USA[/caption]
Jack Cooper, Content Manager (JC): Workstation rates have fallen across the US over recent years. Do you think this is due to competition in the market or a combination of tenants taking larger space as well as the surge in co-working requirements?
Daniel Soffer, Senior VP (DS): If you’d asked me that question in 2010, I would say it was purely down to the economy. But let’s use NYC as an example here: it's the biggest market after London, and towards the end of 2010 we were actually noticing stabilization of pricing and, in fact, an increase in the average workstation rate. This has been attributed to increased confidence in operators, as well as the introduction of more quality office space. The majority of inquiries we were receiving from 2008 through to Q4 2010 were budget driven- now the companies that come to us are increasingly driven by quality of space, and the technology that serves their needs.
So yes - although there is more competition, which does give the prospect more opportunities, it has also resulted in operators improving their product and services. With that increased level of quality, people are prepared to pay more for spaces and services. I don't think we can compare co-working space rates with traditional executive suite rates, as they are hugely different services - even if they can be housed under the same roof.
JC: Which US markets can you see expanding the most over the next five years?
DS: We’ve seen continuing growth in Atlanta, Chicago, Dallas, Houston, Los Angeles, and New York City over the past five years, and don’t see any signs of market stagnation yet. A number of prominent operators have been securing premier space across these markets, and we haven’t had trouble finding affluent tenants scrambling for occupancy.
JC: Do you feel that the more conventional leased rental options are now becoming more flexible to stop the threat from the flexible office industry?
DS: Although landlords are increasingly flexible in terms (something considered almost necessarily in many cases in modern deals), they often lack the expertise and infrastructure to offer the wealth of services professional serviced space brokers can provide. Specialist operators like Search Office Space offer tailored, professional solutions suitable for almost every business scenario. It’d be very hard for traditional landlords to match that level of specialism, and no amount of late-adopted flexibility will change that.