Office Space Advice
Karen Condi Offers Pulse on Executive Office Suites Industry
Published April 1st, 2009 by Jennifer LeClaire
The executive office suites industry is getting a lot of attention in a commercial real estate market that is seeing vacancy rates rise in most major metropolitan areas. Executive office suites offer a lower cost alternative to traditional office space, with a laundry list of services to help companies stretch their budget – and no long-term leases.
For all the positive stories in the press about serviced offices, though, is the entrepreneurial market “getting it?” Is the value proposition clear? Are serviced offices poised to come out of the recession as a force to be reckoned with in the commercial office industry? What’s the best way to choose a serviced office? And how are companies avoiding becoming just a commodity?
Karen Condi, founder and president of Office Suites Strategies, a property management firm that services the executive office suites industry is well positioned to offer some insight. She served as regional manager for Office Suites Plus and is affiliate with Sperry Van Ness Commercial Real Estate Advisors in Lexington, Kentucky. She’s also a member of the Office Business Center Association International, among other groups.
aBetterOffice.com caught up with Condi to shed some light on these and other questions. If you have additional questions, feel free to comment in the box below and we’ll follow up.
I’ve seen so much media attention on executive office suites lately. Do you think the right messages are getting out there about the value, service and other benefits of serviced offices?
It’s a difficult economy right now and the executive office suite (EOS) or office business center (OBC) industry is no different. We are taking a few lumps. However, what is not being mentioned is the value that we truly provide for companies in terms of having packages that do not require companies with office needs to make capital purchases of furniture and technology along with staffing. In addition, the flexibility we offer companies is truly a major benefit of our industry. We allow companies to grow or contract with no substantial cash penalties. So in this economy we offer very little risk and hope to be the provider of choice when things turn around.
How much growth do you project in the executive office suites industry in the next five years? 10 years? 20 years?
It’s tough to say given the current climate, but I think we will be on the front side of the turnaround and begin healthy growth as the economy begins to expand once again. Given more and more companies require the flexibility and need the complete package of services mentioned earlier, this will bode well for our industry.
I hear of stories all the time where a company is stuck in 5,000 square feet of space for three people because they signed a long-term lease. The EOS/OBC industry has maintained solid footing despite the economy and I would anticipate 10 percent growth over the next five years and another 10 percent over the next 10. As far as 20 years I think advancements in technology will change office space as we know it so I don’t want to try to predict that future!
Aside from the recession spurring downsizing and the need for more flexible office solutions, what are the drivers of growth in the executive office suite industry as you see them? In other words, what are the traditional drivers?
The need companies have to get satellite offices up and running without IT support, without major capital outlays, and the other service requirements have been and always will be drivers for our industry. At the end of the day we make it easy for our clients to focus on their business while we take care of the details for their foundation and that will always drive us forward.
What are the key differentiators between the various serviced office facilities in the marketplace? To some, it may seem they are all alike.
The range is tremendous from one OBC to another; there are some that just offer space and a desk to others that offer complete services, staffing, conference rooms and state of the art technology. With the constant advancement of technology, we are seeing varying factors in way of what the OBCs are offering here as well.
Of course, one of the main deciding factors is always location. Clients must have the appropriate location for their office space. From there, they should take a look at the various services the property offers, along with the level of customer service. The executive office suite must stay on the cutting edge to deliver the latest and greatest technology.
How can a company choose the best executive office suite property for their needs?
It’s a function of what their needs are do they need to project a world-class image or do they simply need a place to work. A simple visit will deliver all the answers. Technology is certainly an area in which I am seeing differences among the providers today and an area potential clients should pay close attention to. Some are still offering the same technology packages they offered five to 10 years ago and some are staying on top of the game and are on the cutting edge with their offerings. For example, we are seeing more IP phone systems out there today, more advanced telecommunications offerings such as “follow me anywhere” systems.
What are the biggest obstacles for the serviced office industry from an adoption standpoint? Why don’t more companies opt for them now?
I think there is a misconception as to the overall cost. But when you compare all of the costs apples to apples, we are a far better value than traditional office space. I think some people don’t understand that we truly are a long-term solution for a company and not just a start up option. Some of our best clients have been with our centers for five, 10 or 15 years.
Why should executive office facilities consider using property management services?
In difficult times it’s always good to have another view on your business, bring in an independent outsider look at what can be done to increase profitability. Those are the services we provide, from marketing to operations expertise. In the past there has been a sort of “if you build it they will come” mentality and that is simply not the case any more. You must focus on best of breed practices in these times.
When the recession is over, how much headway do you think the serviced office industry will have made in its quest to compete with traditional office spaces?
Given how many companies who are downsizing and paying huge sums of money to just close an office, we will be positioned very well because we limit risk and corporate America will recognize this. We must simply seize the opportunity.
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About the Author
Mike Sullivan April 1st, 2009 at 6:05 pm
Karen - Thanks for the insights. I know Karen quite well, and believe if you are looking for someone to help you with office suite operations or marketing she is a great resource. Give her a call!
Jason Tiemeier April 2nd, 2009 at 7:34 am
I have worked with Karen and know her quite well. She is very sharp and knows the industry extremely well. She would be a vital asset to any operator or building owner looking for assistance with their OBC. You will receive a return on that investment many times over.
Maggie Correta April 7th, 2009 at 1:49 pm
I don’t know Karen, but I thank her for her insights into the serviced office industry. I think a lot of executive office suites properties could benefit from a strong property management company heading up the charge. Some of them lack customer service and a good property management firm can help close those gaps.
Rob Zeus April 10th, 2009 at 11:54 am
Is Karen available to answer additional questions on the executive office suite industry? I’d like to know if serviced offices seem to be performing better in some parts of the country than others. I see a lot of this in California and New York, but are flexible office rentals as popular across the Midwest.