Of the City of London’s 10,000 small businesses, nearly one quarter – employing 80,000 workers – are located in flexible workspaces. Demand for workspace in the City is increasing as working styles at both corporate and SME levels are changing. On 30 August, Future of London led a field trip to City of London workspaces as part of our Workspace that Works programme.
Evolution of City workspaces
Sandra Jones, a consultant for Ramidus and Dataloft, has researched SME workspace on behalf of both City of London and the GLA (see below for links). City workspace diversity has increased significantly in the last five years as a result of changing work habits, economic cycles, and the property industry learning to accommodate SMEs in response to government emphasis on SME support.
City workspace rents range from £500 to £1500 per desk per month. Tenants usually take five to nine desks for an average of 18 to 24 months. These tenants include start-ups and more established SMEs, as well as corporations who use workspace for short-term projects or other business endeavours.
The three quarters of City SMEs on traditional office tenancies offer a huge market for flexible workspace growth. Property owners and landlords increasingly recognise potential to help small businesses grow and set aside floor space for flexible workspace alongside their traditional offer.
City Business Library
City Business Library offers business resources, training room hire, seminars and workshops, and workspace. CBL’s workspace is mainly used by sole traders and early stage businesses. Seminars and workshops are delivered by SMEs, often in partnership with colleges, universities, and business organisations. They’re a major draw for CBL, bringing in 68% of its users. CBL also works with other specialist libraries including the British Library and Westminster library.
Alexandra Leader, Business Engagement Manager at City Business Library, is overseeing a programme of upgrades to provide amenities that better fit small businesses needs, such as spaces for people to make calls and a more professional, business-oriented image. CBL is also expanding its online services with a business-support webchat, offering support to people who can’t get to the library. To support its growth, CBL is seeking corporate sponsors to complement funding from City of London Corporation and training-room hire.
Bathtub 2 Boardroom
Launched in January 2014, Bathtub 2 Boardroom operates a meanwhile space in a four-storey building due for redevelopment. CEO Paddy Willis explained that B2B focuses on businesses less than a year old with fewer than five people and ambitions for job creation. B2B itself began with a loan from Trust for London and a grant from the Capital Acceleration Programme.
B2B tenants come from a wide range of sectors, including tech, fashion, recruitment and food. They receive a two year membership with dedicated desks or hotdesk spaces rented on a monthly basis. After two years, larger businesses either move to more suitable workspaces or to a stepped rent arrangement, which subsidises rent for new members.
For business support, B2B provides seminars, ‘tub talks’ hosted by the Escape School and led by experienced entrepreneurs, lunch sessions with experts (e.g. PR, sales skills, intellectual property) and events to showcase businesses to investors. Businesses, schools and the public can also make use of Fab Lab, a manufacturing and prototyping space in B2B’s basement. At the community level, B2B and the Prince’s Trust run a bursary programme helping individuals back into employment or with skills and training.
Matching startups with investors is the focus of Innovation Warehouse, which launched in 2011. IW tenants are early stage digital technology businesses that already have seed funding and show strong potential for growth and job creation. Managing Director and Co-Founder Ami Shpiro estimates that the top 10 companies that have gone through IW have created around 500 jobs.
Rents vary depending on a tenant’s stage of growth, with more established tenants subsidising newer ones. IW’s workspace offers hotdesk space for newer businesses, dedicated desk space for established businesses and meeting rooms. For business support, tenants can attend workshops and receive mentoring to help them become ready for investment. Investors are introduced to investment-ready tenants so they can get to know each other before making an investment, which tends to range from £150k-£500k.
- The City of London runs the City Property Advisory Team, which helps businesses moving to the city find appropriate office space.
- The City Property Association represents 170 property-owner and developer members in the City and its fringes. Charles Begley, Executive Director, explained that the CPA hosts events and seminars for members in addition to investing in research to guide small business policy and growth in the city.
Sandra’s research for City of London
- Serviced offices and agile occupiers [PDF]
- Future Workstyles and Future Workplaces [PDF]
- Clusters and Connectivity [PDF]