Serviced office centre opens at One Fullerton

Source : Straits Times - 17 Oct 2008

THE Regus Group, the world’s largest provider of serviced offices, officially opened a centre in One Fullerton yesterday, confident that demand will stay high despite the financial crisis.

Regus has been on an aggressive expansion drive in the Asia-Pacific and aims to open more facilities in the region, said the group’s chief executive for Asia-Pacific, Mr Filippo Sarti.

Demand for serviced offices in the region has risen as firms keep up with a changing business world amid globalisation and more travel.

‘It is a growing industry in Singapore, Hong Kong, India and in the other markets where rents are high and there is a lack of supply or premium- grade office buildings,’ said Mr Stephen Chatham, director of operations of another serviced office operator here called The Executive Centre.

Regus One Fullerton, which occupies 20,623 sq ft, has 327 fully furnished workstations, some overlooking the Marina Bay area. The London-listed provider of outsourced workplaces, as it calls itself, also has two other larger facilities here - at Centennial Tower and UOB Plaza 1 Centre.

Regus was operating a centre at Ngee Ann City for two years but the relentless rent increases at the prime Orchard Road building proved too much.

It took over the Ngee Ann City centre when it bought the Singapore business of serviced office operator MRCentre. Occupancy was full but clients there were also feeling the pinch of higher rentals.

Office rents at Ngee Ann City were renewed at an average of $14.20 per square foot (psf) in June when official data was last made available, although asking levels were at $16 psf. This compares with average rents of $7 to $8 psf in the first half of last year.

Recent CB Richard Ellis data shows that office rents have stabilised, with Grade A levels unchanged in the third quarter at $18.80 psf per month while prime rents were stable at $16.10.

While office supply remains tight, more space is expected from 2010. Property consultants expect rents, which rose dramatically last year, to trend lower.

At the Regus Group, business is expected to remain strong despite the financial crisis.

‘We’ll have to be more creative and flexible but I don’t see that as a constraint for the business,’ said Mr William Willems, Regus’ country general manager for South-east Asia. He said it is already seeing more retentions as firms, wary of the uncertainties ahead, decide to stay on instead of committing to a permanent space.

‘We foresee an increase in demand for our services during these tough times,’ said Mr Chatham. ‘For example, our serviced office options are ideal to companies that are looking to downsize but need to be in the CBD area.’

Rates at the One Fullerton centre start from $9,000 a month for a 16 sq m office, which can fit three workstations. There is an opening promotion rate of just over $6,000 a month for the same space.

Regus, which has 950 centres in 400 cities worldwide, counts companies like Google, IBM and Nokia among its clients; however, a large proportion of its clients are small companies.

For such firms, the service office offers a ready set-up - workstations, meeting room, lounges and a receptionist in a professional environment - that they can tap without needing a large investment, said the Regus officials.