Serviced Office vs Coworking Space: A Comprehensive Comparison

Flexible workspaces have become a favourite in the Singapore business environment as professionals seek more than the traditional office lease. Serviced offices and coworking spaces are two of the most common solutions employed because of their myriad of services.

But is one better than the other? Often, people compare a serviced office vs coworking space, and while both offer flexibility with convenience, there are distinct differences between the two.

In this comprehensive comparison, we will delve into the key differences, advantages, and disadvantages of these workspace solutions so you can select the one that suits your business needs.

What is a serviced office?

A serviced office is a workspace that comes fully furnished and includes access to facilities and support services for a cost-effective solution. They typically include quality furniture, Wi-Fi and shared facilities such as kitchens, boardrooms and phone booths.

Each serviced office provider will include a variety of different services and it’s crucial to differentiate their offerings.

What are the benefits of Serviced Offices?

From fully furnished spaces to high-speed internet connectivity, these offices provide convenience and efficiency for entrepreneurs and professionals alike.

Fully furnished office spaces

Businesses that rent a traditional office have complete freedom over their office design, but this comes at a significant cost. A serviced office comes with all the necessary equipment, so a company can start working immediately without the hassle and expense of purchasing furniture.

From storage space and printers to desks and chairs, the concern of spending thousands on furniture is non-existent. Logistics also become simplified, with computers being the only equipment that must be self-supplied.

Keep in mind that not all serviced offices will have the same amenities.

Saving capital

The cash flow needed for leasing a conventional office is monumentally greater than its flexible counterpart.

Besides a lease, businesses must pay for outgoings, furniture, technology, and maintenance. This cost is amplified every time a company decides to expand its footprint. Here’s an example of how much a small business would spend on average:

All of these costs are mitigated with a serviced office.

Quality meeting rooms

Not every meeting can be held in your office, but conveniently, most serviced offices have meeting rooms or boardrooms that can be booked for the day.

For example, Servcorp’s meeting rooms are designed to accommodate client meetings, presentations, and collaborative sessions. All spaces are equipped with modern technology for seamless productivity and businesses save plenty of capital by renting these spaces, as opposed to building it themselves.

It’s also quite convenient since searching externally for meeting spaces is unnecessary.

Business enhancing technology

A serviced office is more than a desk and a chair encased by four walls with a frosted glass door.

What makes the difference is access to technology.

A quality serviced office has technology that enhances your business operations, with no IT infrastructure commitment needed by the tenant.

Serviced offices will include Wi-Fi and a phone system, but some providers will have additional benefits.

Convenient and great locations

Serviced offices are strategically located in prime areas with easy accessibility to transportation options such as buses, trains, or major highways. Location is an essential factor when selecting a serviced office and you should consider the following questions:

For example, a serviced office in the Marina Bay Financial Centre or CapitaGreen is more likely to tick all the boxes while also being cost-effective. Such areas are considered business capitals and are surrounded by many high-performing businesses and amenities.

Acquiring a traditional office in these locations typically requires significant capital and lengthy leases, but a serviced office is very flexible. Consider browsing some of the best-serviced office locations in Singapore before signing off any contract.

Drawbacks of Serviced Offices: Lack of Control

Convenience and flexibility are abundant with a serviced office, but they come with some drawbacks. Here are some limitations that businesses should consider if opting for this flexible workspace.

Office layout difficulties

The office is our second home, and as with any place where most of our time is spent, we desire control. Workspace design is still available in a serviced office space, but is significantly less than the conventional office.

Businesses can’t alter the paint on the walls, change the flooring or doors, and remove any light installations. They still have the liberty to bring their own artwork, additional furniture and whatever accessories they like.

It’s not a major drawback, but it is one to consider.

Minimal branding opportunities

Branding is a significant aspect of establishing a business’s identity.

But serviced offices often restrict branding opportunities to ensure the entire floor has a neutral aesthetic. This ensures that any clients visiting your serviced office won’t be confused about why other companies are near your space.

However, branding inside your office space is generally accepted so long as it’s not outside your door.

Limited amenities compared to traditional office spaces

Larger companies typically require a lengthier list of amenities.

A conventional office might include services such as cafeterias, gyms, and recreational areas for employee satisfaction. Many serviced offices won’t have access to such amenities, but it’s all about selecting the right location.

Serviced offices in business districts, such as The Metropolis, are strategically located for drawing in businesses that require many amenities. Parks, restaurants, bars, gyms, waterfront promenades, and public transport are some of the many features the thoughtfully located serviced offices have.

Regardless of these drawbacks, serviced offices still hold great value for many small businesses or startups:

• They provide an affordable alternative to long-term leases.

• Serviced offices offer flexibility in terms of lease duration.

• They allow businesses to focus on core operations rather than managing administrative tasks like maintenance and cleaning.

What is a coworking space?

A coworking space is an environment that is intended to facilitate work for a diverse range of businesses in a shared office space. They are an ideal workspace for businesses that value collaboration and are the fastest-growing flexible workspace solution.

People who read this article also read 9 Tips on How to Choose a Coworking Space.

What are the benefits of Coworking Spaces?

Many companies of all sizes are ditching the traditional office and opting for a coworking space because of its advantages.

Cost-effective alternative

While a serviced office costs significantly less than a conventional office, coworking spaces take this to the next level. Commitment durations and upfront costs are minimal, while membership options are broad to cater to various business needs.

• Members can choose from various packages based on their requirements and budget.

• Monthly memberships allow businesses to scale up or down as needed without being tied down by long-term contracts.

• Shared resources such as utilities, internet connectivity, and office equipment help reduce overhead costs significantly.

Flexible membership options 

The average office space lease in a business district can last five to ten years. Whereas coworking spaces. Whereas coworking spaces offer monthly, half-yearly, and yearly membership options to give businesses control over their workspace choices.

A coworking space also has two working styles on offer. Hot desks are ideal for businesses that prefer a dynamic environment and are happy to occupy any empty desk. While dedicated desks suit businesses or employees that need a permanent space with more customizability.

Freelancers have begun opting for pay-as-you-go memberships, that can cost as low as $60 per month.

Networking and Collaboration Opportunities

Did you know that coworking spaces present many networking opportunities?

The nature of shared workspaces opens the door for connecting with like-minded individuals during events or even in the kitchen. Often, community managers hold self-promotion opportunities, and other businesses use this as a chance to promote their products or services.

From this, businesses can sell their offerings, find new clients, or make important connections that can lead to potential growth. Ensure that your coworking space provider has community events and ask for an introduction to neighbouring coworkers when joining.

Disadvantages of Coworking Spaces

Coworking spaces are commonly known as shared workspaces, which can be a drawback for some people. However, remember that selecting the right provider can mitigate many disadvantages.

Noisy Coworkers and music

Loud phone conversations or speaking at a high volume, in general, can quickly become an issue in a coworking space. Unlike a serviced office, there’s no door you can close for privacy.

Some coworking floors have music playing in the background - unfortunately, there’s normally nothing that can be done about this other than finding a different coworking space.

Some potential solutions include:

• Finding a coworking space with private phone booths.

• Speaking with your community manager.

• Utilising designated quiet areas.

• Selecting a coworking space that is quiet and professional.

Lack of Privacy

Another drawback of coworking spaces is the lack of privacy they offer. Shared workspaces often entail open floor plans or shared desks, so you will have plenty of neighbours nearby.

Although most will respect your personal space, it’s easy for someone to look over your shoulder to observe your screen or listen in on a conversation. People often question whether coworking spaces are safe, but it all depends on the provider.

Ensure there are meeting rooms, private phone booths, and breakout areas in case you require privacy.

Which one should I get?

There’s no one-size-fits-all answer, but there are guidelines you can follow.

Small businesses looking to access amenities and workspaces can opt for coworking because of its low cost and flexibility. Whereas larger companies wanting to branch out, reduce overheads, or provide hybrid work conditions can also utilise coworking spaces.

Overall, serviced offices are the closest form of commercial real estate to the traditional office and hold the benefit of being a potential head office or hub-and-spoke office model.