An Executive Office for One VS. An Office Membership in a Coworking Space
Coworking spaces are on the rise as an attractive alternative to the traditional office. When it comes to traditional office leases, there are actually a substantial amount of unforeseen costs that you probably aren’t accounting for when choosing the perfect office space to suit your business needs.
I spent the past year in search of a 3,000 square foot space for WingSpace. I looked at many properties and learned quite a bit about why there are so many empty office suites in Prescott.
Of course, not every business is a good fit for a coworking space, but for those who do not NEED a receptionist, nor your company name on the front of the building then an office membership in a coworking space may work for you.
Here is a cost breakdown and comparison:
Executive Office for One
Let’s start with an average executive office space for one person in Prescott. Leasing a single office in an executive office suite (roughly 150 sq ft) in a reputable area starts at around $400 per month. Sounds like a pretty doable price tag. Right? Of course, you’ll be locked in to commercial office space lease (minimum 6 month to 1-year term) plus you’ll have the additional costs that aren’t included in the monthly lease which include:
(Full disclosure, it’s a long list. The following costs are based on a conservative budget)
Because each business is unique in it’s needs, the landlord will most likely leave it to you to design and furnish your private office. And that price is just for the basics, no ambiance or personality in décor included. Desk, chair, file cabinet, garbage can, guest chair(s), lamp, paint.
Maintenance and Cleaning $100/month
Executive Office buildings will likely have pre-arranged service agreements for routine cleaning and maintenance. So while you probably won’t have to go out and hire a cleaning company, you will still be seeing part of that bill.
Legal Fees – $500 to $1,500
There are usually a number of legal costs involved in a commercial office space rental agreement. You may want to hire a lawyer to review your contract. Believe me, you will want to foot the bill for this, because making sense of the legalese is nearly impossible for the average person. I almost signed an agreement that made me responsible for fully insuring the HVAC system for full replacement. Eeek! I ended up walking away from that space after I had an HVAC inspector look at the system, and he informed me that the HVAC system was severely damaged, and needed to be replaced. That would have been a $10,000 bill! Seriously!
Tax – 6%
Some commercial property owners opt to tax the renter when leasing office space – this is common. Be sure to ask your landlord if there is the additional cost for tax, and take a look at the registration before thinking you landed a budget-friendly deal.
Utilities – $200/month
Water, electricity, gas, and waste disposal are sure to add a few more dollars to your monthly rental agreement. Not to mention if your office features heat, security…and the list goes on.
IT – $150/month
Solid Internet connection is a must in the office. Wi-Fi certainly won’t be included with your lease, so budget for a router, comm. lines, cable, and installation.
Equipment – $1,000
From printers to a copy machine, paper shredder, and a flat screen TV for presentations.
Office Supplies – $100/month
Sure they’re small, but paper, staplers, printer ink, pens, post-it notes and all those minute necessities of a productive workspace are sure to add up each month.
Renters Insurance - $30/mo.
This can often be a nominal cost under your home owners insurance policy.
Amenities – $75/month
Aside from the basics, a happy office space should offer things like coffee, a water cooler, and refrigerator to store a packed lunch.
Office Membership for One
Okay, now let’s have a look at all the additional expenses of an office membership at a coworking space. Well, all of these additional costs are nonexistent if you choose to set up shop in a coworking space. That's right. Coworking space office memberships offer the privacy of a conventional office, all-inclusive amenities, and flexibility to cancel month-month. Pretty much a no-brainer if you ask me.
Memberships at WingSpace coworking range from
• $25 for a day pass
• $170 for a hot desk membership in the open coworking space
• $325 for a dedicated desk on a shared office
• $550 for a private office membership: includes an desk, chair, locking file cabinet, and garbage can.
Best of all, the terms are flexible, meaning cancelable month-to-month. A Coworking space takes care of all the shared office necessities as well, including: office supplies, amenities, equipment, Wi-Fi, IT and presentation equipment, utilities, confernce rooms, kitchen, and so on, so you don’t have all the start up expenses to set up an office. You can just focus on more important things – like getting work done.