MatchOffice Survey Report - Lokalebasen


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SURVEY REPORT 2016

49 countries 689 serviced offices MatchOffice presents a comprehensive survey of the market, bringing you the latest trends and updates from across the world. Get all the data and analysis you need, right here

Table of Contents Introduction ..................................................................................... 3 Europe ................................................................................................ 4 Belgium .............................................................................................. 9 Denmark ......................................................................................... 14 Sweden ......................................................................................... 19 Germany .................................................................................... 24 The Netherlands ................................................................. 29 France ................................................................................ 34 Spain ............................................................................ 39 Italy ....................................................................... 44 Asia ............................................................. 49 North America ............................... 52

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The latest updates from the offices of the future:

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Last year, MatchOffice conducted the largest-ever survey on serviced offices in Europe. 689 serviced offices from 35 countries participated, providing the most in-depth insight ever into the current status of the market and our expectations for the future. This year, to expand the scope, we’re delighted to present an even bigger report, from almost fifty countries across the world. The survey explores occupancy, prices and outlook for the industry in the rest of 2016. Serviced offices have moved forward impressively in the last year, and many new offices have emerged into an already thriving market. To support that growth, more and more companies are choosing to work in serviced offices, and our survey data suggests that this will continue for the rest of this year and into 2017. Better still, this survey’s results show us that 60 percent of serviced offices have an average occupancy rate of more than 80 percent. That’s a hugely encouraging statistic, and gives us an excellent outlook for the year to come. We would like to give our thanks to every single participant for sharing their vital information with us, and it’s a pleasure and a privilege to present this report of the results. I hope you find it interesting and useful.

Jakob Dalhoff CEO, MatchOffice Share on Facebook

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Europe Over 60% of serviced offices expect occupancy rates of more than 80% in 2016

The European market is in great shape, with less than 12% of serviced office providers returning a negative outlook for this year. Occupancy rates are rising, both in terms of an increase in the overall average rate and in the proportion of individual offices that have experienced an increase in their rates. Almost one third saw occupancy of 90% or more at the time of surveying. Better still, that decrease in availability of serviced office space has contributed to the pushing up of the price level for almost 30% of companies, even with almost 80% reporting that their contract lengths had stayed the same or increased since last year. Jakob Dalhoff sees an excellent future for new offices as well as those surveyed this year. We have seen more centres that have been completely filled within a few months. If you have the right product with a good location, it’s possible to find tenants for your new serviced office quite fast. That was reflected in the data, too. Over 80% of companies expected increases or the same level in both prices and occupancy rates for the rest of 2016. Profitability for serviced offices is set only to increase in the coming year. 4

EUROPE

1

2/7

Average office occupancy 40,0%

32,3%

33,8% 28,4%

30,0%

23,4% 20,0%

16,9% 17,3%

15,1% 11,7%

12,3% 8,8%

10,0%

0,0%

Under 60%

60% - 69%

70% - 79%

2015

80% - 89%

Over 90%

2016

More than 60% of Europe’s serviced offices show rates of occupancy higher than 80%. That has increased by 6.5 percentage points since last year, from which the majority comes in serviced offices that now are above 90% occupied.

2

Occupancy compared to last year 40,0%

33,9%

32,7% 33,6%

29,2%

30,0%

21,2% 17,4%

20,0%

10,0%

4,3%

8,0%

6,3%

6,3%

4,6%

2,6%

0,0%

Much lower

Lower 2015

The Same

Higher

Much higher

Don't know

2016

7 in 10 serviced offices in Europe showed the same or higher occupancy rates as in 2015. In both 2015 and 2016 the majority of respondents said their occupancy was the same or higher, showing a two year continued positive outlook from 2014-16. INDUSTRY REPORT

5

EUROPE

3

4/7

Occupancy expectation in 6 months 50,0%

46,1% 37,8%

36,7%

40,0%

31,1% 30,0%

20,0%

13,2% 9,8%

8,9%

10,0%

6,9% 2,0% 2,9%

2,0% 2,6% 0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

With a tendency towards higher occupancy rates in Europe, it is not altogether surprising that just 37.8% of Europe’s serviced offices expect higher rates of occupancy in the next half-year - a decrease of 10 percentage points in this figure compared with 2015.

4

Achieved prices for office contracts or workstations compared to last year 60,0%

54,0%

52,3%

50,0%

40,0%

27,0%

30,0%

18,5%

20,0%

20,5% 16,5%

10,0%

1,7%

1,7%

1,7% 0,9%

3,5%

1,7%

0,0%

Much lower

Lower 2015

The same

Higher

Much higher

Don't know

2016

In our 2015 report, 75% of Europe’s serviced offices experienced the same or higher contract prices compared to 2014. In 2016, this is closer to 80%. In general, prices in Europe have settled, but the increase could be due to office scarcity. INDUSTRY REPORT

6

EUROPE

5

6/7

Expected price level in 6 months 80,0%

67,0%

70,0%

63,5%

60,0% 50,0% 40,0% 30,0%

20,1%

23,4%

20,0%

9,2% 11,1% 10,0%

0,3% 0,3%

1,1% 0,9%

2,3% 0,9%

Much higher

Don't know

0,0%

Much lower

Lower

The same

Higher

2015

2016

As in 2015, the majority of serviced offices expect price levels to remain the same within the next 6 months. Around 3 percentage points fewer in 2016 expect the prices to stay the same, with an equivalent 3-point rise in those believing they will increase.

6

Initial contract length compared to last year 66,1%

70,0%

64,7%

60,0% 50,0% 40,0% 30,0% 20,0%

18,8%

17,0%

15,2% 10,1% 4,9%

10,0%

3,2%

0,0%

Shorter

The same 2015

Longer

Don't know

2016

Although the majority of contracts still have the same length compared to the year before, the 5 percentage point increase in longer contracts could be due to larger, less flexible companies beginning to invest in serviced rather than traditional office space. INDUSTRY REPORT

7

EUROPE

7

7/7

General outlook 60,0%

51,3% 50,0%

44,4%

40,0%

30,0%

24,6%

27,7% 15,8% 15,3%

20,0%

9,8% 10,0%

5,2%

2,0% 1,4%

1,1% 1,4% 0,0%

Very negative

Negative 2015

Neutral

Positive

Very positive

Don't know

2016

Despite almost 60% of serviced offices throughout Europe having a positive or very positive attitude towards business for the rest of 2016, there is a dent in the year-on-year figure: offices that have a negative outlook have increased by 4 percentage points.

8

Belgium Much of the data from Belgium comes from the capital region, around Brussels and Antwerp, and shows a more even spread in occupancy rates than the rest of Europe, alongside generally stable price levels and contract lengths. That said, there has been an increase in occupancy since 2015 and the majority of Belgian offices report a positive or very positive outlook for the rest of 2016.

BELGIUM

1

2/7

Average office occupancy 30,0%

26,1%

27,9% 23,2%

21,7% 20,0%

17,4%

16,1%

18,3%

17,4%

17,4%

14,5%

10,0%

0,0%

Under 60%

60% - 69%

70% - 79%

80% - 89%

2015

Over 90%

2016

Belgium shows a more even distribution of occupancy rates, although the data is still negatively skewed, with the majority of offices surveyed experiencing rates of more than 80%. Since 2015, there has been a 6 percentage point increase in the 90%+ category.

2

Occupancy compared to last year 46,9%

50,0%

43,5% 40,0%

31,3% 30,0%

26,1% 17,4%

20,0%

10,0%

15,6%

4,3%

4,3%

6,3%

0,0%

4,3% 0,0%

0,0%

Much lower

Lower 2015

The Same

Higher

Much higher

Don't know

2016

Generally, the occupancy rate is increasing in larger Belgian cities, with almost 85% of serviced offices showing the same or higher occupancy rates than in 2015. Very few offices found much higher rates - just 6.3% - and none found them much lower. INDUSTRY REPORT

10

BELGIUM

3

4/7

Occupancy expectation in 6 months 60,0%

50,0% 50,0%

43,5%

40,0%

31,3% 26,1%

30,0%

20,0%

10,0%

13,0% 4,3%

6,3%

13,0% 6,3%

6,3% 0,0% 0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

The tendency towards 100% occupancy means that the growth has been less steep than in 2015. Although the majority of Belgian offices do still expect higher rates of occupancy within the next 6 months, very few expect them to be much higher.

4

Achieved prices for office contracts or workstations compared to last year 65,6%

70,0%

56,5%

60,0% 50,0% 40,0% 30,0%

21,7%

17,4% 18,8%

20,0%

12,5%

10,0%

4,3% 0,0% 0,0%

0,0% 0,0%

0,0%

0,0%

Much lower

Lower 2015

The same

Higher

Much higher

Don't know

2016

As in 2015, about 75% of Belgian serviced offices this year experienced the same or higher contract prices compared to the previous year, but there was around a 10 percentage point reduction in higher prices and an equivalent increase in those that were the same. INDUSTRY REPORT

11

BELGIUM

5

6/7

Expected price level in 6 months 75,0%

80,0%

69,6% 70,0% 60,0% 50,0% 40,0% 30,0%

21,7% 15,6%

20,0%

9,4%

8,7%

10,0%

0,0% 0,0%

0,0% 0,0%

0,0% 0,0%

Much higher

Don't know

0,0%

Much lower

Lower

The same

Higher

2015

2016

Unsurprisingly, given the stability of contract and workstation prices over the last year, the overwhelming majority of Belgian offices expect the price level to remain the same in the next 6 months. No offices expected them to be much higher or much lower.

6

Initial contract length compared to last year 90,0%

78,1%

80,0%

65,2%

70,0% 60,0% 50,0% 40,0% 30,0%

21,7%

18,8%

20,0%

4,3%

10,0%

8,7% 3,1%

0,0%

0,0%

Shorter

The same 2015

Longer

Don't know

2016

As is representative of the Belgian market, and even more so than in the picture for Europe as a whole, contract lengths are very stable. Like in 2015, around 20% experienced shorter contracts year-on-year, and fewer than 5% experienced longer. INDUSTRY REPORT

12

BELGIUM

7

6/7

General outlook 60,0%

50,0%48,4%

50,0%

42,9%

40,0%

32,3% 30,0%

20,0%

12,9% 7,1% 6,5%

10,0%

0,0% 0,0%

0,0%

0,0% 0,0%

0,0%

Very negative

Negative 2015

Neutral

Positive

Very positive

Don't know

2016

As in 2015, no offices surveyed held a very negative outlook this year. In fact, the picture for Belgium was very positive, with 93.5% of surveyed offices having a neutral or better outlook. The 12.9% increase in ‘very positive’ shows much greater confidence.

13

Denmark In general, the data from Denmark is not skewed, but somewhat gathered around the centre of the Likert scale. This is due to around half of the respondents originating in Copenhagen, which is a successful city for serviced office space. Perhaps the most exciting Danish results are those of outlook, in which no respondents felt negative about the future there.

DENMARK

1

2/7

Average office occupancy 50,0%

38,5%

36,4%

40,0%

27,3%

30,0%

23,1% 20,0%

23,1%

18,2% 13,6%

10,0%

7,7%

7,7% 4,5%

0,0%

Under 60%

60% - 69%

70% - 79%

80% - 89%

2015

Over 90%

2016

As in 2015, over 60% of Danish serviced offices have occupancy rates of higher than 80%. Average occupancy rates in 2016 are higher than both in 2015 and compared to the average for continental Europe, although over 15% still have a rate of less than 70%.

2

Occupancy compared to last year 50,0%

40,0%

38,5%

36,4% 30,8% 27,3%

30,0%

23,1% 18,2%

20,0%

9,1%

10,0%

7,7%

0,0% 0,0%

9,1% 0,0%

0,0%

Much lower

Lower 2015

The Same

Higher

Much higher

Don't know

2016

The fact that occupancy is increasing in Denmark is supported by the comparative figures between 2015-2016, which show that over three quarters of offices have the same, higher or much higher rates. 9 percentage points of this increase came in the ‘higher’ band. INDUSTRY REPORT

15

DENMARK

3

4/7

Occupancy expectation in 6 months 60,0%

50,0% 46,2%

50,0%

38,5%

40,0%

31,8% 30,0%

20,0%

9,1% 7,7%

10,0%

4,5%

7,7%

4,5%

0,0% 0,0%

0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

Almost 55% of the Danish serviced offices expect higher or much higher occupancy rates in the next 6 months, which is on par with last year’s results. Compared to the results from wider Europe, which showed a minor decrease, Denmark has a far more stable rate of occupancy.

4

Achieved prices for office contracts or workstations compared to last year 80,0%

68,2%

70,0%

61,5%

60,0% 50,0% 40,0% 30,0%

23,1% 18,2%

15,4%

20,0%

9,1% 10,0%

0,0% 0,0%

0,0% 0,0%

4,5%

0,0%

0,0%

Much lower

Lower 2015

The same

Higher

Much higher

Don't know

2016

Like Belgium, Denmark’s price level appears to be relatively stable, with almost two thirds of prices remaining the same and approximately even numbers increasing and decreasing. As in 2015, there were no ‘much higher’ or ‘much lower’ achieved prices. INDUSTRY REPORT

16

DENMARK

5

6/7

Expected price level in 6 months 80,0%

68,2%

70,0%

61,5%

60,0% 50,0% 40,0% 30,0%

23,1% 18,2%

15,4%

20,0%

9,1%

4,5%

10,0%

0,0% 0,0%

0,0% 0,0%

0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

Although the numbers of both increases and decreases in price expectation have increased, the figures remain relatively balanced, with almost two thirds expecting a stable price level for the rest of 2016. This is broadly representative of Europe in general.

6

Initial contract length compared to last year 80,0%

65,2%

70,0%

69,2%

60,0% 50,0% 40,0% 30,0%

21,7%

23,1%

20,0%

4,3%

10,0%

7,7%

8,7% 0,0%

0,0%

Shorter

The same 2015

Longer

Don't know

2016

As in 2015, there are just over 20% of offices experiencing shorter contracts year-on-year, but the overwhelming trend is one of continuity, with 70% staying the same. The slight rise in all categories is due to a reduction in those who answered ‘don’t know’ in 2015. INDUSTRY REPORT

17

DENMARK

7

7/7

General outlook 50,0%

46,2% 36,4%

40,0%

30,8%

31,8% 27,3%

30,0%

23,1% 20,0%

10,0%

4,5% 0,0% 0,0%

0,0% 0,0%

Very negative

Negative

0,0%

0,0%

2015

Neutral

Positive

Very positive

Don't know

2016

The general outlook for the Danish serviced offices is highly positive, with 23.1% reporting a very positive outlook and 46.2 % a positive outlook. As in the 2015 survey, none of the respondents indicated that the general outlook for them was negative.

18

Sweden The Swedish market has an extremely positive outlook, with huge increases in 90%+ occupancy rates, price level, contract lengths and general outlook. The only drawback in Swedish statistics is in the occupancy expectations that have fallen, which could be explained through large average occupancy rate increases and a natural stabilisation in the future.

SWEDEN

1

2/7

Average office occupancy 47,1%

50,0%

38,9%

40,0%

30,0%

23,5% 17,6%

20,0%

22,2%

16,7%

11,1%

11,1%

11,8%

10,0%

0,0% 0,0%

Under 60%

60% - 69%

70% - 79%

80% - 89%

2015

Over 90%

2016

Most of the respondents to the MatchOffice survey were located in Stockholm, and the picture from this year’s survey statistics shows a huge increase of over 20 percentage points in 90%+ and a substantial rise in 80-89% occupancy rates in the capital.

2

Occupancy compared to last year 50,0%

38,9%

40,0%

35,3%

33,3%

35,3%

30,0%

17,6%

20,0%

11,1% 11,8%

11,1% 10,0%

5,6% 0,0% 0,0%

0,0%

0,0%

Much lower

Lower 2015

The Same

Higher

Much higher

Don't know

2016

Although the majority of respondents believe that occupancy rates will be the same in 6 months, the rest of responses are divided similarly between lower and higher expectations. This is likely due to the already high average rates within the Swedish market. INDUSTRY REPORT

20

SWEDEN

3

4/7

Occupancy expectation in 6 months 60,0%

55,6%

50,0%

41,2% 40,0%

29,4% 30,0%

23,5% 16,7%

20,0%

11,1% 10,0%

5,6% 5,9%

5,6%

5,6% 0,0%

0,0% 0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

The occupancy outlook in Sweden is very encouraging, with over half of respondents reporting that they expect figures to rise in the next two quarters, even though occupancy is up year-on-year already. The other results are mixed, but the picture is positive.

4

Achieved prices for office contracts or workstations compared to last year 70,0%

58,8%

60,0%

52,9% 47,1%

50,0% 40,0%

29,4% 30,0% 20,0%

5,9%

10,0%

0,0% 0,0%

5,9% 0,0%

0,0% 0,0%

0,0%

0,0%

Much lower

Lower 2015

The same

Higher

Much higher

Don't know

2016

Interestingly, the entirety of the surveyed industry in Sweden experienced the same or higher prices than in 2015. The price index is certainly on the increase, with a rise of almost 20 percentage points in higher prices, even on the already-high 2015 figures. INDUSTRY REPORT

21

SWEDEN

5

6/7

Expected price level in 6 months 70,0%

61,1% 60,0%

58,8%

50,0%

40,0%

27,8%

30,0%

29,4%

20,0%

11,8% 10,0%

5,6% 0,0%

5,6%

0,0%

0,0%

0,0%

0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

Despite the clear increases since 2015 in the serviced office price index, a significant minority of almost 30% believe that it will continue to increase, displaying significant confidence in the market. Only 11.8% believe prices will decline this year.

6

Initial contract length compared to last year 90,0%

77,8%

80,0%

76,5%

70,0% 60,0% 50,0% 40,0% 30,0% 20,0% 10,0%

17,6% 11,1%

5,9%

5,6%

5,6% 0,0%

0,0%

Shorter

The same 2015

Longer

Don't know

2016

An overwhelming 76.5% of respondents reported that contract lengths have stayed the same, only a 1.3 percentage point reduction in last year’s results. Despite the obvious stability over the last two years in contracts, 17.6% still think they might get longer. INDUSTRY REPORT

22

SWEDEN

7

7/7

General outlook 80,0%

72,2%

70,0% 60,0% 50,0%

41,2%

40,0%

29,4% 30,0%

22,2% 23,5%

20,0%

5,9%

10,0%

0,0% 0,0%

5,6% 0,0% 0,0%

0,0%

0,0%

Very negative

Negative 2015

Neutral

Positive

Very positive

Don't know

2016

Only 5.9% of respondents have a negative outlook for the rest of 2016, suggesting significant confidence in the Swedish serviced office market. Notably and encouragingly, there has been an increase of more than 35 percentage points in ’very positive‘ outlooks.

23

Germany The German serviced office market shows great stability and potential for the coming year. Like the general trend for mainland Europe, it shows increased occupancy rates and price inflation since 2015, alongside an expected reduction in fluctuation over the next 6 months. Germany shows the highest proportion of occupancy over 90%, at almost 45%.

GERMANY

1

2/7

Average office occupancy 50,0%

44,4% 38,9%

40,0%

36,8%

28,9%

30,0%

20,0%

13,2% 10,0%

10,5% 5,6%

10,5%

8,3%

2,8%

0,0%

Under 60 %

60 % - 69 %

70 % - 79 %

80 % - 89 %

2015

Over 90 %

2016

German average occupancy is exceptional, in that the vast majority of the offices have over an 80%. This has had a potential effect on the price level, as tenants struggle to find space in popular areas and large cities, but bodes well for providers this year.

2

Occupancy compared to last year 47,2%

50,0%

42,1% 40,0%

33,3% 30,0%

26,3%

23,7% 20,0%

13,9% 7,9%

10,0%

0,0%

2,8%

0,0%

0,0%

2,8%

0,0%

Much lower

Lower 2015

The Same

Higher

Much higher

Don't know

2016

The majority of German serviced office providers have seen occupancy remain the same over the last year, although a third have seen it increase. No providers saw a much higher increase, which is unsurprising given the very high averages in both 2015 and 2016. INDUSTRY REPORT

25

GERMANY

3

4/7

Occupancy expectation in 6 months 80,0%

69,6% 70,0% 60,0%

50,0% 50,0%

39,5%

36,1%

40,0% 30,0% 20,0% 10,0%

0,0%

2,8%

5,3%

10,5%

8,3%

0,0%

2,6% 2,8%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

Half of German offices expect the occupancy at the end of 2016 to be the same, and there has been a radical reduction in those that expect an increase, compared to 2015. This is partly a result of the already-high figures compared to the rest of Europe.

4

Achieved prices for office contracts or workstations compared to last year 80,0%

66,7%

70,0%

55,3%

60,0% 50,0%

34,2%

40,0%

30,6%

30,0% 20,0%

5,3%

10,0%

0,0% 0,0%

2,8%

2,6%

0,0%

2,6%

0,0%

0,0%

Much lower

Lower 2015

The same

Higher

Much higher

Don't know

2016

Almost all serviced office providers experienced the same or higher prices than in 2015. The fairly large 30% proportion that saw higher prices could be explained by the decrease in office availability as a result of high occupancy rates and market clearing. INDUSTRY REPORT

26

GERMANY

5

6/7

Expected price level in 6 months 80,0%

71,1%

70,0%

66,7%

60,0% 50,0% 40,0%

23,7% 25,0%

30,0% 20,0%

8,3%

10,0%

2,6%

0,0% 0,0%

2,6%

0,0% 0,0%

0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

The 2016 graph for forecasted prices is approximately the same as the 2015 graph, suggesting that providers in general believe that the market is involatile. Almost no providers expect prices to fall, which is indicative of the popularity of German office space.

6

Initial contract length compared to last year 80,0%

73,7% 66,7%

70,0% 60,0% 50,0% 40,0% 30,0% 20,0%

15,8%

16,7% 11,1%

7,9%

10,0%

2,8%

5,6%

0,0%

Shorter

The same 2015

Longer

Don't know

2016

Unlike in neighbouring France, German contract lengths have not seen a general trend of decline across the two years of survey data, and a large two-thirds majority have seen contracts stay the same length. Interestingly, more offices are uncertain than in 2016. INDUSTRY REPORT

27

GERMANY

7

7/7

General outlook 70,0%

62,9% 57,9%

60,0% 50,0% 40,0% 30,0%

26,3%

22,9% 15,8%

20,0%

11,4% 10,0%

0,0% 0,0%

0,0%

2,9%

0,0% 0,0%

0,0%

Very negative

Negative 2015

Neutral

Positive

Very positive

Don't know

2016

The apparent success of the German market shown in this year’s survey is also reflected in the extremely positive outlook of firms for the rest of 2016. Although fewer offices expect a ‘very positive’ 6 months, only a tiny 2.9% have negative forecasts.

28

The

Netherlands Although the Netherlands follows the wider European trend of increasing occupancy rates and marginal increases in price and contract length, the most interesting development in the data is the emergence of very high, over 90% results on the Likert scale in terms of occupancy. Most firms are optimistic about the future, with over 40% expecting both higher prices and occupancy, and over 60% a positive or very positive outlook in the last two quarters of 2016.

THE NETHERLANDS

1

2/7

Average office occupancy 60,0%

50,0% 50,0%

36,4%

40,0%

27,3%

30,0%

21,4%

21,4%

20,0%

10,0%

15,5% 7,1%

11,8%

9,1%

0,0% 0,0%

Under 60%

60% - 69%

70% - 79%

2015

80% - 89%

Over 90%

2016

As in 2015, around 50% of serviced offices in the Netherlands have occupancy rates of 80% or more. A large increase of 15.5 percentage points of offices have now become over 90% occupied, from no offices at all in the 2015 MatchOffice survey.

2

Occupancy compared to last year 50,0%

42,9% 40,0%

18,2%

20,0%

10,0%

28,6% 27,3%

27,3%

30,0%

14,3% 7,1%

9,1%

7,1%

9,1%

9,1% 0,0%

0,0%

Much lower

Lower 2015

The Same

Higher

Much higher

Don't know

2016

Dutch data is relatively similar in 2015 and 2016, but there has been a small shift from positive to negative skew in the data, indicating the typical European increase in occupancy rates across 2014-2016. There is a small increase in much smaller occupancy. INDUSTRY REPORT

30

THE NETHERLANDS

3

4/7

Occupancy expectation in 6 months 57,1%

60,0%

54,5%

50,0%

40,0%

28,6% 27,3%

30,0%

20,0%

14,3% 9,1%

10,0%

5,5%

3,6%

0,0%

0,0%

0,0% 0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

Strikingly in this graph, although there has been a small reduction in the proportion of higher expectations, perhaps as a result of the increase in 90%+ average figures, a large majority of 54.5% remain optimistic for occupancy in the rest of 2016.

4

Achieved prices for office contracts or workstations compared to last year 57,1%

60,0%

50,0% 50,0%

35,7%

40,0%

30,0%

22,7% 18,2%

20,0%

9,1%

7,1%

10,0%

0,0% 0,0%

0,0% 0,0%

0,0%

0,0%

Much lower

Lower 2015

The same

Higher

Much higher

Don't know

2016

Half of respondents to the survey reported prices that had remained the same, and the number of lower and higher prices is almost equal, suggesting that the price index in serviced offices changed little over the last year. There are no much higher or much lower prices. INDUSTRY REPORT

31

THE NETHERLANDS

5

6/7

Expected price level in 6 months 57,1%

60,0%

47,3%

50,0%

36,4%

40,0%

30,0%

21,4%

21,4% 16,4%

20,0%

10,0%

0,0% 0,0%

0,0% 0,0%

0,0% 0,0%

Much higher

Don't know

0,0%

Much lower

Lower

The same

Higher

2015

2016

Like in last year’s survey, around half of respondents report an expectation of no price inflation over the next 6 months, although there has been an increase in the proportion of those who expect higher prices. This reflects how prices did increase since 2015.

6

Initial contract length compared to last year 70,0%

64,3%

60,0%

47,0%

50,0% 40,0% 30,0%

34,0% 28,6% 19,0%

20,0%

7,1%

10,0%

0,0%

0,0%

0,0%

Shorter

The same 2015

Longer

Don't know

2016

The Dutch serviced office market subverts the wider European trend, in that over a third of respondents saw a reduction in contract lengths and less than half stayed the same. Interestingly, there was also a 11.9 percentage point rise in those that saw an increase. INDUSTRY REPORT

32

THE NETHERLANDS

7

7/7

General outlook 60,0%

50,0% 50,0%

45,5%

42,9%

40,0%

30,0% 30,0%

18,2%

20,0%

7,1%

10,0%

0,0% 0,0%

6,4% 0,0%

0,0%

0,0%

0,0%

Very negative

Negative 2015

Neutral

Positive

Very positive

Don't know

2016

Every respondent in the Netherlands had at least a neutral view of the market. Despite declining contract lengths, rising occupancy has kept forecasts positive for the rest of 2016, with almost one-fifth viewing the outlook as ‘very positive’.

33

France The French market is characterised at present by low occupancy rates: they have fallen on average since 2015 and outlook indicators suggest that providers expect them to drop further. This could be to do with the rising price level, as shown by 30% of providers experiencing higher achieved prices year-on-year. Yet, offices’ expectations for them to now remain the same mean that the market could stabilise over the next 6 months.

FRANCE

1

2/7

Average office occupancy 40,0%

30,0%

30,0%

30,0%

23,1% 20,0%

15,0% 15,4%

23,1%

23,1%

15,4%

15,0% 10,0%

10,0%

0,0%

Under 60%

60% - 69%

70% - 79%

80% - 89%

2015

Over 90%

2016

Despite almost half of French offices having occupancy of more than 80%, France still lags behind the European average, with 38.5% of offices having less than 70% occupancy. French offices are clearly struggling the average has actually fallen since 2015.

2

Occupancy compared to last year 50,0%

38,5%

40,0%

35,0%

30,0%

25,0%

20,0%

25,0%

23,1%

23,1%

15,4% 10,0%

10,0%

5,0% 0,0%

0,0% 0,0%

0,0%

Much lower

Lower 2015

The Same

Higher

Much higher

Don't know

2016

For a 38.5% majority of offices in France, occupancy has stayed the same. Yet more offices have seen a reduction in their tenancy than an increase, and there are no firms with much higher occupancy than in 2015. The year-on-year rate is lower than in 2015. INDUSTRY REPORT

35

FRANCE

3

4/7

Occupancy expectation in 6 months 50,0%

45,0%

40,0%

35,0% 30,8%

30,8%

30,0%

20,0%

15,4%

10,0%

15,0%

5,0%

7,7%

7,7%

0,0%

7,7% 0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

Compared to the average for continental Europe, French serviced offices have a very negative outlook for the rest of 2016. 15.4% of offices expect that occupancy figures will fall in the next 6 months, with 30,8% believing that they will stay the same.

4

Achieved prices for office contracts or workstations compared to last year 70,0%

61,5% 55,0%

60,0% 50,0% 40,0%

30,8% 30,0%

20,0% 15,0%

20,0% 10,0%

7,7%

5,0%

5,0%

0,0%

0,0% 0,0%

0,0%

0,0%

Much lower

Lower 2015

The same

Higher

Much higher

Don't know

2016

One explanation for the fall in occupancy rates in France could be the general increase in the price level, with almost a third of serviced offices reporting an increase in achieved prices and only 7.7% reporting them to be lower, leading to a loss of demand. INDUSTRY REPORT

36

FRANCE

5

6/7

Expected price level in 6 months 84,6%

90,0%

75,0%

80,0% 70,0% 60,0% 50,0% 40,0% 30,0%

15,0%

20,0% 10,0%

5,0%

0,0% 0,0%

7,7%

7,7%

5,0%

0,0% 0,0%

0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

Interestingly, despite the year-on-year increases in price between 2015 and 2016, an overwhelming 84.6% of serviced office providers expected prices to remain the same for the next 6 months, suggesting that the surge may now be over.

6

Initial contract length compared to last year 60,0%

53,8% 50,0%

50,0%

40,0%

30,0%

30,8%

30,0%

20,0%

15,0%

15,4%

10,0%

5,0% 0,0%

0,0%

Shorter

The same 2015

Longer

Don't know

2016

The majority of contracts have the same length as in 2015. Like last year’s results, roughly 30% experienced shorter contracts, while around 15% experienced longer contract. The status quo, of declining lengths, has been maintained in this year’s data. INDUSTRY REPORT

37

FRANCE

7

7/7

General outlook 50,0%

45,0% 38,5%

40,0%

30,0% 30,0%

25,4%

23,1% 20,0%

15,0% 11,5%

10,0% 10,0%

0,0% 0,0%

0,0%

1,5%

0,0%

Very negative

Negative 2015

Neutral

Positive

Very positive

Don't know

2016

Roughly one third of French serviced offices have a positive general outlook for the rest of 2016, which compared to last year is a decrease of almost 25 percentage points. Unlike last year, the majority of serviced offices now have a neutral outlook.

38

Spain In general, the picture for Spain is encouraging, with serviced office providers expecting higher or the same prices, longer or the same contracts and holding a majority positive outlook for the rest of 2016. Yet other data is somewhat polarised, with higher statistics for both ‘much higher’ and ‘lower’ expected occupancy in the next 6 months, and an increase in those who ‘don’t know’ about occupancy over the previous year.

SPAIN

1

2/7

Average office occupancy 50,0%

45,0% 38,8%

40,0%

30,0%

20,0%

20,4%

18,4%

17,5%

16,3% 17,5%

12,5% 10,0%

7,5%

6,1%

0,0%

Under 60%

60% - 69%

70% - 79%

80% - 89%

2015

Over 90%

2016

Given the difficulties in Spanish property markets over the last year and wider issues within the economy, the occupancy figures are particularly encouraging. More than 60% have an occupancy of over 80%, which is a 7.4 percentage point increase year-on-year.

2

Occupancy compared to last year 40,0%

34,7% 28,6%

30,0%

25,0% 20,4% 17,5%

20,0%

15,0% 10,2%

12,5% 9,1%

10,0%

4,1% 5,0%

2,0%

0,0%

Much lower

Lower 2015

The Same

Higher

Much higher

Don't know

2016

In the majority, occupancy figures for Spain are either the same or higher than in 2015. The recovering economy is clearly a factor in the slower improvements compared to the rest of Europe, but the ‘same’ and ‘lower’ categories are both substantially reduced. INDUSTRY REPORT

40

SPAIN

3

4/7

Occupancy expectation in 6 months 60,0%

50,0% 50,0%

40,0%

30,0%

25,0% 25,0%

22,5%

20,0%

15,0%

12,5% 10,0%

6,3%

10,4%

6,3% 2,1%

0,0%

0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

Unlike in 2015, where the majority of surveyed office providers expected higher occupancy over the next 6 months, the data in 2016 shows a polarised opinion where, interestingly, more providers expect both lower and much higher prices in the year to come.

4

Achieved prices for office contracts or workstations compared to last year 80,0% 70,0%

63,3%

67,5%

60,0% 50,0% 40,0% 30,0%

22,4% 17,5%

20,0%

10,2% 10,0%

4,1%

7,5%

0,0%

5,0% 0,0%

0,0%

2,5%

0,0%

Much lower

Lower 2015

The same

Higher

Much higher

Don't know

2016

The prices for contracts seem to be even more stable than they were at this time last year. A larger majority of 67.5% expected prices to remain the same, and despite the rise in ‘much higher’ prices, they appear to be expected to stabilise for the rest of 2016. INDUSTRY REPORT

41

SPAIN

5

6/7

Expected price level in 6 months 75,5%

80,0%

72,5%

70,0% 60,0% 50,0% 40,0% 30,0%

22,5%

20,0%

14,3% 8,2%

10,0%

2,5%

0,0% 0,0%

2,0%

0,0%

0,0%

2,5%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

Unsurprisingly, given the relative stability of price levels within the Spanish market, the majority of serviced office providers expect prices to stay the same. Even still, there has been an 8 percentage point increase in those who think prices will be higher.

6

Initial contract length compared to last year 70,0%

63,8% 56,4%

60,0% 50,0% 40,0% 30,0%

21,3% 20,0%

17,9%

15,4% 8,5%

10,0%

6,4%

7,5%

0,0%

Shorter

The same 2015

Longer

Don't know

2016

Although the majority of serviced offices expect contract lengths to stay the same, there has been a general increase in the lengths of contracts across the last 12 months, as shown by the almost 10 percentage point increase in the ‘higher’ category. INDUSTRY REPORT

42

SPAIN

7

7/7

General outlook 60,0%

51,0%

52,5%

50,0%

40,0%

28,6%

30,0%

20,0% 20,0%

17,5% 14,3% 7,5%

10,0%

4,1% 0,0%

2,0%

0,0%

2,5%

0,0%

Very negative

Negative 2015

Neutral

Positive

Very positive

Don't know

2016

Not a single respondent within the Spanish market believed that the outlook for the next 6 months was ‘very negative’. The majority, of 52.5% had a positive outlook, with only 37.5% holding a neutral or negative forecast.

43

Italy The picture of the Italian serviced office market is essentially one of stability. Year-on-year, the figures are similar - either in the 40% increase in occupancy in both 2015 and 2016, or in the price level and contract lengths that stay the same year-on-year in around 70% of cases. This contributes to a positive outlook for the majority of serviced office providers for the rest of 2016 and a belief that the status quo will be maintained.

ITALY

1

2/7

Average office occupancy 40,0%

34,5% 28,6%

30,0%

21,4% 20,7%

21,4% 20,7%

20,0%

14,3% 13,8%

14,3% 10,3%

10,0%

0,0%

Under 60 %

60 % - 69 %

70 % - 79 %

80 % - 89 %

2015

Over 90 %

2016

According to the 2016 survey data, over 55% of Italy’s serviced offices have occupancy rates of over 80%. There has been an average occupancy increase in Italy year-on year since 2015, mainly in the 80-89% bracket, but the other brackets remain quite stable.

2

Occupancy compared to last year 50,0%

42,9% 40,0%

41,4%

34,5% 28,6%

30,0%

20,0%

10,7%

10,3% 7,1% 6,9%

10,0%

7,1% 3,6% 3,4%

3,4% 0,0%

Much lower

Lower 2015

The Same

Higher

Much higher

Don't know

2016

Survey data from this year shows that the increase in occupancy rates in 2015-2016 roughly mirrors that of 2014-2015. There is a small, 3% increase in firms experiencing much higher rates, and an expected drop of 7% in firms with much lower rates than last year. INDUSTRY REPORT

45

ITALY

3

4/7

Occupancy expectation in 6 months 60,0%

51,7% 50,0%

39,3% 35,7%

40,0%

27,6%

30,0%

21,4% 20,0%

10,3% 10,0%

3,6%

6,9%

0,0% 0,0%

3,4%

0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

As could have been predicted by the average and year-on-year figures, some of the Italian market (39.3%) expects that occupancy rates could continue to increase, although a majority of just over one half believe that they will now stay the same.

4

Achieved prices for office contracts or workstations compared to last year 75,9%

80,0% 70,0% 60,0%

46,4%

50,0% 40,0%

28,6%

30,0%

21,4%

20,0%

13,8%

10,3%

10,0%

0,0% 0,0%

0,0% 0,0%

3,6%

0,0%

0,0%

Much lower

Lower 2015

The same

Higher

Much higher

Don't know

2016

The change between both surveys in prices of contracts in Italy is largely in the movement from lower and higher prices to those that are the same, year-on-year. In 2016, over three quarters of offices say that prices are stable, and none report ‘much’ higher or lower. INDUSTRY REPORT

46

ITALY

5

6/7

Expected price level in 6 months 90,0%

75,0%

80,0%

78,6%

70,0% 60,0% 50,0% 40,0% 30,0%

14,3%

20,0%

14,3%

10,7%

7,1%

10,0%

0,0% 0,0%

3,6%

0,0% 0,0%

0,0%

0,0%

Much lower

Lower

The same

Higher

2015

Much higher

Don't know

2016

This graph shows that not only have prices remained the same between 2015 and 2016, the overwhelming majority of providers also expect them to stay the same for the rest of the year. This is interesting, given the increase in occupancy in the same period.

6

Initial contract length compared to last year 80,0%

73,7% 67,9%

70,0% 60,0% 50,0% 40,0% 30,0% 20,0%

15,8%

14,3%

14,3% 7,9%

10,0%

2,8%

3,6%

0,0%

Shorter

The same 2015

Longer

Don't know

2016

As in 2015, the majority of Italian serviced office businesses have seen little change in contract lengths over the last year. If anything, the change yearon-year lies in the increased number of longer contracts, a change of around six-and-a-half percentage points. INDUSTRY REPORT

47

ITALY

7

7/7

General outlook 70,0%

58,6%

60,0%

50,0% 50,0% 40,0%

31,0% 25,0%

30,0% 20,0% 10,0%

7,1%

7,1% 6,9%

7,1%

0,0%

3,4%

3,6%

0,0%

0,0%

Very negative

Negative 2015

Neutral

Positive

Very positive

Don't know

2016

Although the number of Italian businesses with very positive outlooks has decreased compared to last year’s survey data, the general picture is positive, with a majority of 58%. A notable third sees the rest of 2016 to be neutral, again reflecting market stability.

48

Asia In general outlook, the Asian market showed a 62.9% ‘positive’ or ‘very positive’ forecast for the rest of the year

Although the data collected from Asia is relatively sparse compared to our European survey, the results display a heartening image of healthy occupancy levels in the market and stability in price levels and year-on-year occupancy figures. The proportion of serviced offices with more than a 90% occupancy rate in Asia is higher than in Europe by three percentage points, placing the Asian serviced office market in a similar league to high-performing European countries such as Denmark. Their outlook for the next year in occupancy rates is lower, however, with a majority of 47.1% expecting the same occupancy rates as in 2015. In Europe, a third of respondents reported an expectation of higher rates in the year to come, and around 70% expected the same or higher price levels at the end of 2016. In general outlook, the Asian market showed a 62.9% ‘positive’ or ‘very positive’ forecast for the rest of the year, and only 14.3% ‘negative’ or ‘very negative’. Naturally, the results from the MatchOffice survey cannot be representative of the continent as a whole, but with the results that we have received, we can only be encouraged for the future in this developing market.

49

ASIA

1

2/4

Average office occupancy 40,0%

31,4% 28,6%

30,0%

25,7%

20,0%

11,4% 10,0%

2,9% 0,0%

Under 60%

60% - 69%

70% - 79%

80% - 89%

Over 90%

2016

Although there is no comparative data from 2015, the picture we have constructed from our data in Asia is an encouraging one. The 90%+ occupancy rate is higher than the European average, and over 85% of serviced offices are occupied more than 70% of the time.

2

Occupancy compared to last year 47,1%

50,0%

40,0%

30,0%

20,6%

17,6%

20,0%

10,0%

8,8%

5,9%

0,0% 0,0%

Much lower

Lower

The Same

Higher

Much higher

Don't know

2016

In general, the year-on-year picture of the occupancy rate of the Asian market is one of stability. A majority of 47% report the same occupancy figures as last year, and although more report falling rates than rising, there is no serious cause for concern. INDUSTRY REPORT

50

ASIA

3

4/4

Expected price level in 6 months 40,0%

37,1% 31,4%

30,0%

25,7%

20,0%

10,0%

2,9%

2,9%

0,0% 0,0%

Much lower

Lower

The same

Higher

Much higher

Don't know

2016

A majority of almost 40% expect prices to remain the same for the rest of 2016, and around six percentage points more expect prices in Asia to rise than fall over the next 6 months. A very small proportion expect much higher or lower prices in the same period.

4

General outlook for the rest of 2016 60,0%

48,6%

50,0%

40,0%

30,0%

22,9%

20,0%

10,0%

14,3% 5,7%

8,6% 0,0%

0,0%

Very negative

Negative

Neutral

Positive

Very positive

Don't know

2016

Encouragingly, a majority of almost half of respondents have a positive outlook for the rest of 2016. Other than that, respondents were still generally positive, albeit with a sizable minority of almost 23% answering neutrally to the next 6 months’ prospects. INDUSTRY REPORT

51

North America North American businesses have experienced and expect stable price and occupancy levels between 2015 and 2016

There are considerable similarities between the Asian serviced office market and the North American market in terms of the results from the MatchOffice survey. North American businesses also display an extremely encouraging level of occupancy, with over two-fifths showing 90%+ occupancy rates and less than 12% with occupancy of less than 70%. Almost 80% of North American businesses report occupancy as remaining the same or increasing since last year, a fact also reflected in the high occupancy average in the 2016 statistic. Although, in general, North American businesses have experienced and expect stable price and occupancy levels between 2015 and 2016, forecasts are positive, with almost a third expecting higher prices in the next 6 months. Unlike in Asia and Europe, however, the future outlook in North America is in the majority neutral, albeit with approximately even numbers of providers reporting positive and very positive forecasts and only 9.5% suggesting a negative 6 months. MatchOffice is grateful to the respondents in North America, and looks forward to working with them more as the serviced office industry grows in the year to come.

52

NORTH AMERICA

1

2/4

Average office occupancy 50,0%

40,5% 40,0%

26,2%

30,0%

21,4% 20,0%

10,0%

7,1%

4,8%

0,0%

Under 60%

60% - 69%

70% - 79%

80% - 89%

Over 90%

2016

The North American market shows excellent results, with a higher proportion than both Europe and Asia in 90%+ occupied serviced offices. Even discounting that 40.5%, almost all other respondents had at least 70% occupancy in January-August of 2016.

2

Occupancy compared to last year 50,0%

38,1%

40,0%

28,6%

30,0%

20,0%

10,0%

14,3%

11,9%

4,8%

2,4%

0,0%

Much lower

Lower

The Same

Higher

Much higher

Don't know

2016

As in the Asian market, the majority of respondents in North America found that occupancy rates were similar to those in 2015. Yet the next largest proportion was in ‘higher’ rates, suggesting a slowly increasing rate that bodes well for the American market. INDUSTRY REPORT

53

NORTH AMERICA

3

4/4

Expected price level in 6 months 70,0%

61,9%

60,0% 50,0% 40,0%

28,6%

30,0% 20,0%

9,5% 10,0%

0,0%

2,4%

0,0%

0,0%

Much lower

Lower

The same

Higher

Much higher

Don't know

2016

As well as no respondents to our survey expecting much higher or lower prices over the next two quarters, a very large proportion expect stable prices. Despite the 28.6% that expect price increases, we nonetheless imagine that inflation will be limited this year.

4

General outlook for the rest of 2016 50,0%

38,1%

40,0%

26,2%

30,0%

23,8%

20,0%

9,5% 10,0%

2,4%

0,0% 0,0%

Very negative

Negative

Neutral

Positive

Very positive

Don't know

2016

The majority of North American respondents have neutral outlooks for the rest of the year, which is unsurprising given the very small changes expected in occupancy and price on average by our respondents this year. We wish our American providers well for 2016. INDUSTRY REPORT

54

A global leader in serviced office provision MatchOffice is Europe’s leading serviced office broker, specialising in serviced office rental since 2003. Over 4.800 serviced office providers have chosen to sell to clients using MatchOffice, using our online commerce solutions and technological innovation. In the last year, MatchOffice has offered new solutions to offices across Europe and the world, with the advent of Virtual Reality tours and custom assistance with photography. Thousands of businesses worldwide use our services, both to sell office space and benefit from the countless advantages of renting serviced, rather than traditional, offices. Our database is varied and exhaustive, offering huge choice in both form and location. MatchOffice is the officebroker of the future, and the global leader in its field.

Abelogade 4, DK-2100 Copenhagen +45 39 45 85 50 [email protected] MatchOffice is present in more than 100 countries and has local sites in a number of coutries including: Sweden, Denmark, Norway, Finland, Poland, Germany, The Netherlands, Austria, Belgium, Switzerland, Luxembourg, France, Spain, Italy, India, Singapore, and Hong Kong.