Office Space News
Regus Earnings Offer Pulse of Serviced Office Industry
Published March 20th, 2009 by Jennifer LeClaire
If you want to take the pulse of the executive office suites industry, just look at the Regus Group. On Friday, Regus issued its annual earnings report for 2008.
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Regus reported a 25 percent increase in revenues and a 21 percent rise in profits. The serviced office company’s total capacity, including workstations in non-consolidated businesses, saw a 10 percent hike to total 171,277 square feet.
In more good news for the company, Regus watched its average occupancy increase 0.2 points to 82.9 percent. Given that the company opened an additional 112 new business centers in 2008, that’s an especially impressive statistic that underscores the company’s savvy expansion strategy.
A Helping Hand
Regus says relied on programs like its proprietary “Get Started” campaign it communicate that it offers real support for entrepreneurs. Get Started offers office space and practical support for start-up’s that need help getting off the ground. Regus is offering unlimited use of its business lounges and cafés in over 1,000 locations worldwide. The Get Started campaign aims to help up to 50,000 entrepreneurs realize their business ambitions while mitigating some of the risk.
A couple of additional statistics before we listen in to Regus’ take on the earnings report. Revenues for businessworld, its membership plan, rose by more than 900 percent. More than 200,000 people have become members of businessworld since its launch in 2008. The fast ramp up on memberships demonstrates that entrepreneurs and companies are searching for value-added perks in the serviced office industry.
“2008 was another successful year for Regus, delivering a fifth consecutive year of record performance,” says Regus CEO Mark Dixon. “With over £149 million of profits, and net cash exceeding £210 million for the first time, we have demonstrated the significant progress that has been made within the business in recent years.”
Regus’ Next Move
Dixon admits that the global economic background has become more difficult. As Regus moves through 2009, he says the company will continue to focus on efficiencies and driving down costs while maintaining its focus on targeted investment for long-term growth.
“Our newly introduced portfolio of recession-busting products is attracting many new customers who are looking to reduce their office costs and gain flexibility in an increasingly challenging marketplace,” Dixon says. “This is providing new revenue opportunities for Regus.”
Of course, the economic crisis is buoying most of the serviced office industry, making this alternative office space among the few bright spots in commercial real estate. Quality operators are enjoying a boost from the credit crisis, which makes it more difficult for start-ups to get into longer-term leases and purchase office equipment. Look for Regus to continue its winning streak throughout 2009, as other serviced office companies vie for a piece of this growing pie.
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About the Author
Mike Sullivan March 20th, 2009 at 7:53 pm
I read the annual results announcement, and what’s most impressive is that the Americas (83% of Americas centers are in the US) average occupancy was 86 percent. Asia was the region that brought down the overall average.
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