SURVEY REPORT 2017
42 countries 721 serviced offices For the third consecutive year, MatchOffice presents an in-depth market survey, conducted in 42 countries. 721 serviced offices have shared with us their statistical data. Read inside to find out what changes this year has brought to the industry.
Table of Contents Introduction ..................................................................................... 3 Europe ................................................................................................4 Belgium .............................................................................................. 9 Denmark ......................................................................................... 14 France ........................................................................................... 19 Germany .......................................................................................... 24 Italy ................................................................................................ 29 The Netherlands ................................................................... 34 Spain ................................................................................. 39 Sweden ...................................................................... 44 Asia ..................................................................... 49 North America ....................................... 52
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The latest information on the serviced office industry:
The MatchOffice Survey Report 2017 Share on Facebook
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Last year, we conducted a comprehensive survey on the serviced office industry with a huge number of contributors from all over the world. We received detailed data on office occupancy, achieved and expected price level and providers’ outlook on business. This year, we show how the conditions have changed since 2016, which was a year of stability and growth for many serviced offices. It seems that our optimism was well-placed, and the results indicate a very healthy industry, especially in Europe. We would like to express our gratitude to all the participants for sharing their achievements from last year and expectations for next year with us. We are pleased to present this year’s MatchOffice industry survey results. I sincerely hope they will be of interest to you.
Jakob Dalhoff CEO, MatchOffice Share on Facebook
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Europe Over 60% of offices in Europe have occupancy rates of more than 80%
The European market looks buoyant in 2017. The popularity of serviced offices continues to grow all over Europe, which is clearly reflected in our survey results. Average office occupancy in Europe has increased compared to last year, and over half of all respondents expect even more tenants this year. As for the prices, the market has achieved stability: the majority of all providers have the same prices as last year, while 25% have reported an increase. Every third provider expects profitability to grow in the near future. Overall, almost 70% of the surveyed offices see the industry very positively. Over the last year, encouraging market trends have led to expansion of sites and new offices in existing plots, which is expected to fuel more growth in the future and stimulate demand. With the latest promising statistics in mind, Jakob Dalhoff predicts a great future for the offices surveyed this year as well as for those which are just coming onto the market: In retrospect, several markets were in good shape last year, especially the German. Thus far this year, even more providers have reported growing numbers, and many have positive thoughts and expectations about the future. We are confident about the industry’s considerable potential and look forward to its further advancements.
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EUROPE
1
2/7
Average office occupancy 40,0%
33,8%
30,0%
0,0%
28,4%
32,2%
17,3% 17,6%
20,0% 10,0%
30,5%
11,7% 10,3%
Under 60%
8,8%
9,4%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
20172017
This year, the numbers show some minor shifts but are overall very stable. In general, 80.3% of all serviced offices have an average occupancy of more than 70%, which is a small rise of 0.8%-points on last year’s figure.
2
Occupancy compared to last year 40,0%
33,9% 33,8% 33,6% 35,0%
30,0% 17,4% 18,0%
20,0% 10,0% 0,0%
6,3%
6,3% 7,1%
3,2%
Much lower
Lower 2016 2016
The Same
Higher
Much higher
2,6% 2,9% Don't know
20172017
In 2017, office occupancy rates are mainly the same, higher or even much higher for the vast majority of the surveyed providers - 2.1%-points more than last year. Only 3.2% of offices have reported much lower occupancy, which is around a 50% decrease compared to 2016. INDUSTRY REPORT
5
EUROPE
3
4/7
Occupancy expectation in 6 months 50,0% 40,0%
36,7%
38,6% 37,8%
42,4%
30,0% 20,0% 10,0% 0,0%
13,2% 2,6%
9,0%
6,9% 6,8%
1,0%
Much lower
Lower
The same
2016 2016
Higher
Much higher
2,9% 2,3% Don't know
20172017
Our data shows that the number of providers expecting higher occupancy has spiked this year. Fewer providers expect lower occupancy, and virtually the same number of offices expect occupancy equal to last year.
4
Achieved prices for office contracts or workstations compared to last year 60,0%
52,3%
54,6%
50,0% 40,0% 27,0% 25,5%
30,0% 16,5%
20,0% 10,0% 0,0%
14,4%
1,7% 2,0% Much lower
Lower 2016 2016
The same
Higher
0,9% 1,3%
1,7% 2,3%
Much higher
Don't know
2017 2017
Prices in Europe have not fluctuated much this year. More than half of the surveyed providers have maintained the same price. There has been a minor decrease in both inflation and deflation, with the majority maintaining 2016 levels. INDUSTRY REPORT
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EUROPE
5
6/7
Expected price level in 6 months 70,0%
63,5%
60,0%
59,2%
50,0% 40,0% 30,0%
23,4%
20,0% 10,0% 0,0%
11,1% 0,3% 1,0% Much lower
29,1%
7,2%
Lower
The same
Higher
2016 2016
0,9% 1,3%
0,9% 2,3%
Much higher
Don't know
2017 2017
Fewer providers than last year expect to have the same by the end of 2017. Around 30% predict growth – a considerable 5.7%-point year-on-year increase. Only 7.2% expect the prices to fall.
6
Initial contract length compared to last year 80,0%
64,7%
70,0%
72,1%
60,0% 50,0% 40,0% 30,0% 20,0%
17,0%
15,2%
12,8%
10,0% 0,0%
Shorter
The same 2016 2016
11,5%
Longer
3,2%
3,6%
Don't know
2017 2017
The initial contract length remains the same for most providers. The number of longer contracts has decreased by 3.7%-points. The same tendency can be observed in shorter contracts. These figures indicate year-on-year stability in the industry. INDUSTRY REPORT
7
EUROPE
7
7/7
General outlook 60,0%
51,8%
50,0%
44,4%
40,0% 27,7%
30,0%
19,7%
20,0% 10,0% 0,0%
15,3%
9,8% 8,5%
1,4% 2,0%
1,4% 0,7% Very negative
Negative 2016 2016
17,4%
Neutral
Positive
Very positive Don't know
20172017
As the survey shows, the number of serviced offices which have a positive and a very positive outlook on business has risen this year, while the number of those which are negative has fallen. Overall, we can see a clear upward trend.
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Belgium With contributors scattered across Belgium, we can see that the occupancy of already popular offices has risen. The tendency towards growing prices has slowed down in 2017, and a 69% majority predict that this situation will not change in the next six months. Over half of Belgian serviced offices are optimistic about the future.
BELGIUM
1
2/7
Average office occupancy 40,0% 27,9%
30,0% 20,0%
27,7% 23,2%
16,1% 15,7%
14,5%
10,0% 0,0%
30,7%
Under 60%
18,3%
15,6%
10,3%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
2017 2017
This year the number of high-occupancy serviced offices in Belgium has risen. Over half of all serviced offices in Belgium have more than 80% occupancy rate, while the number of offices with a lower occupancy of 60%-69% has slightly fallen.
2
Occupancy compared to last year 46,9%
50,0% 40,0%
31,3%
30,0% 20,0%
15,6%
10,0% 0,0%
0,0%
44,2%
34,5%
13,8% 6,3% 5,0%
2,5%
Much lower
Lower 2016 2016
The Same
Higher
Much higher
0,0% 0,0% Don't know
2017 2017
Almost half of the surveyed offices in Belgium have reported higher occupancy year-on-year between 2016 and 2017, although the numbers since 2015 have slowed. Approximately one third of offices have the same occupancy, and this figure has not changed significantly since last year. INDUSTRY REPORT
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BELGIUM
3
4/7
Occupancy expectation in 6 months 60,0%
50,0%
50,0%
43,2%
38,8%
40,0%
31,3%
30,0% 20,0% 10,0% 0,0%
6,3%
2,3%
Much lower
6,3%
8,2%
6,3% 7,5%
Lower
The same
Higher
2016 2016
Much higher
0,0% 0,0% Don't know
20172017
This year, over half of the surveyed offices expect higher occupancy, which is less encouraging than last year’s figure. In 2017, more providers predict that the situation will settle.
4
Achieved prices for office contracts or workstations compared to last year 65,6% 65,5%
70,0% 60,0% 50,0% 40,0% 30,0%
18,8% 17,4%
20,0% 10,0% 0,0%
12,5%
17,1%
0,0% 0,0% Much lower
Lower 2016 2016
The same
Higher
0,0% 0,0%
0,0% 0,0%
Much higher
Don't know
2017 2017
As in the 2016 figures, the majority of serviced offices found the prices for contracts and workstations were the same year-on-year, suggesting long term stability. A 5%-point rise in higher prices and fall in lower prices may suggest some inflation is on the horizon. INDUSTRY REPORT
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BELGIUM
5
6/7
Expected price level in 6 months 75,0%
80,0% 70,0%
69,0%
60,0% 50,0% 40,0% 30,0%
15,6% 13,8%
20,0% 10,0% 0,0%
9,4%
17,2%
0,0% 0,0% Much lower
Lower
The same
Higher
2016 2016
0,0% 0,0%
0,0% 0,0%
Much higher
Don't know
2017 2017
Although the price level in Belgium was very stable compared to 2016, the headline figure in terms of expectation is that offices do expect prices to rise in the next six months. There was around a 7%-point increase in that figure, which could be good for the sector.
6
Initial contract length compared to last year 90,0%
78,1%
80,0%
75,9%
70,0% 60,0% 50,0% 40,0% 30,0% 20,0%
18,8%
15,5% 3,1%
10,0%
0,0%
Shorter
The same 2016 2016
8,6%
Longer
0,0%
0,0%
Don't know
2017 2017
An overwhelming majority of serviced offices have the same length of contracts as last year, whereas there is a small increase in the number of those which have signed longer contracts this year. INDUSTRY REPORT
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BELGIUM
7
6/7
General outlook 56,7%
60,0%
48,4%
50,0% 40,0%
32,3%
30,0%
24,5%
20,0% 10,0% 0,0%
0,0% 0,0% Very negative
6,5%
12,9%
10,3%
Negative 2016 2016
8,5% 0,0% 0,0%
Neutral
Positive
Very positive Don't know
2017 2017
Optimistic serviced office providers constitute over half of all respondents. Almost a quarter do not anticipate any changes. The number of those who have a negative outlook has slightly increased.
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Denmark In Denmark, more than 80% of all offices have an occupancy rate of more than 70%. Over half of them report higher occupancy than last year and expect growth in the future. Prices, as well as contract length, have not changed significantly since last year. However, there is a small proportion of providers who have a negative outlook.
DENMARK
1
2/7
Average office occupancy 50,0% 38,5%
40,0%
29,9%
30,0%
23,1%
20,0% 10,0% 0,0%
36,8%
7,7%
5,0%
Under 60%
7,7%
23,1%
19,6%
9,7%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
2017 2017
Like in many European countries, the number of providers with a very high occupancy has grown. All in all, more than 80% of all serviced offices are in the three highest-occupancy groups.
2
Occupancy compared to last year 50,0% 38,5% 39,1%
40,0%
30,8% 32,2%
30,0%
23,1% 16,7%
20,0% 10,0% 0,0%
7,7%
11,2%
0,0% 0,8% Much lower
0,0% 0,0% Lower 2016 2016
The Same
Higher
Much higher
Don't know
2017 2017
We can see positive dynamics as more and more businesses choose serviced offices over traditional ones in Denmark. A half of all offices have higher or much higher occupancy, whereas the number of those with lower occupancy has fallen by 6.4%-points. INDUSTRY REPORT
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DENMARK
3
4/7
Occupancy expectation in 6 months 60,0% 46,2%
50,0%
38,5%
40,0%
50,9%
35,1%
30,0% 20,0% 10,0% 0,0%
9,8%
7,7%
7,7%
0,0% 0,0% Much lower
Lower
The same
Higher
2016 2016
4,2%
Much higher
0,0% 0,0% Don't know
2017 2017
The market is thriving in Denmark, so office providers naturally have optimistic expectations, with slightly over half of them predicting that more tenants will be interested in their properties over the course of six months.
4
Achieved prices for office contracts or workstations compared to last year 70,0%
61,5%
60,0%
66,4%
50,0% 40,0% 30,0% 15,4%
20,0% 10,0% 0,0%
23,1%
0,0% 0,0% Much lower
26,0%
5,4% Lower 2016 2016
The same
Higher
0,0% 2,2%
0,0% 0,0%
Much higher
Don't know
20172017
Our data show that most providers have year-on-year stable level of prices, while the tendency for lowering prices has reduced by 10%-points this year. A small proportion of the surveyed serviced offices have significantly increased the prices. INDUSTRY REPORT
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DENMARK
5
6/7
Expected price level in 6 months 74,1%
80,0% 70,0%
61,5%
60,0% 50,0% 40,0% 30,0%
15,4%
20,0% 10,0% 0,0%
0,0% 0,0% Much lower
23,1%
15,0%
8,5%
Lower
The same
Higher
2016 2016
0,0% 2,4%
0,0% 0,0%
Much higher
Don't know
20172017
This year, a vast majority of offices do not expect the prices to change, which suggests stability of the Danish market. The number of those expecting both lower and higher prices has decreased. In 2016, none of the offices expected sharp price fluctuations, while in 2017 some anticipate dramatic growth.
6
Initial contract length compared to last year 90,0%
81,2%
80,0%
69,2%
70,0% 60,0% 50,0% 40,0% 30,0% 20,0% 10,0%
0,0%
23,1% 9,8%
Shorter
7,7% The same 2016 2016
9,0%
Longer
0,0%
0,0%
Don't know
2017 2017
Compared to last year, we can see a marked shift from shorter to same-length contracts. An impressive majority of over 80% have signed a contract for the same period as last year. INDUSTRY REPORT
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DENMARK
7
7/7
General outlook 46,2%
50,0% 40,0%
30,8%
30,0%
36,1%
35,4% 23,1%
25,3%
20,0% 10,0% 0,0%
0,0% 0,0% 0,0% Very negative
3,2%
Negative 2016 2016
0,0% 0,0% Neutral
Positive
Very positive Don't know
20172017
In 2017, more than 60% of serviced offices have a positive outlook for the future. Unlike last year, there is a small proportion of those who are negative, while the number of those with a very positive outlook has also increased by 2.2%-points.
18
France In France, a quarter of all serviced offices have over 90% occupancy. Two-thirds can boast of more tenants than last year. More than 25% of respondents expect the prices to fall, which might be the way for the offices with lower occupancy to attract new clients. Opinions on the future of the industry range from very negative to very positive, with a 41% majority being neutral.
FRANCE
1
2/7
Average office occupancy 30,0% 23,3% 23,1%
23,1% 20,0%
19,4% 15,4%
19,9%
23,1%
25,4%
15,4% 12,0%
10,0%
0,0%
Under 60%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
2017 2017
This year, average occupancy is evenly distributed among all bands, which roughly tracks the results from last year. About a quarter of serviced offices have a very high occupancy of over 90%. The most noticeable change since last year can be seen in 70-79% occupancy band.
2
Occupancy compared to last year 50,0% 38,5%
40,0% 30,0%
40,2%
23,1%
20,0% 15,4%
13,3%
23,1%
27,7%
17,1%
10,0% 0,0%
0,0%
0,0% 1,7%
Much higher
Don't know
0,0% Much lower
Lower 2016 2016
The Same
Higher
2017 2017
In 2017, most respondents have the same or higher occupancy. Although the number of those with lower or much lower occupancy has fallen compared to last year, it remains substantial – slightly below one third. INDUSTRY REPORT
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FRANCE
3
4/7
Occupancy expectation in 6 months 37,1%
40,0% 30,8%
30,0% 20,0%
25,6% 15,4%
13,7% 7,7%
10,0% 0,0%
30,8%
Much lower
9,1%
Lower
7,7%
The same
Higher
2016 2016
9,7%
Much higher
7,7%
4,8%
Don't know
20172017
Roughly one third of office providers who participated in the survey expect to have more tenants in 6 months, which almost equals those who do not expect the status quo to change.
4
Achieved prices for office contracts or workstations compared to last year 80,0% 70,0%
61,5%
60,0%
67,1%
50,0% 40,0%
30,8%
30,0% 20,0% 10,0% 0,0%
0,0%
4,4%
Much lower
7,7%
17,3%
11,2%
0,0%
Lower 2016 2016
The same
Higher
0,0%
0,0% 0,0%
Much higher
Don't know
2017 2017
Two-thirds of the respondents have the same prices as last year. Respectively, there is a noticeable drop in higher and an increase in lower price bands a 13.5%-point decrease in those with high expectations could be a concern for future growth INDUSTRY REPORT
21
FRANCE
5
6/7
Expected price level in 6 months 84,6%
90,0% 80,0%
64,1%
70,0% 60,0% 50,0% 40,0% 30,0% 20,0% 10,0%
0,0%
12,5% 0,0%
7,7%
Much lower
16,3%
Lower
7,7% 7,1% The same
Higher
2016 2016
0,0%
0,0%
0,0% 0,0%
Much higher
Don't know
2017 2017
A quarter of the surveyed offices expect the prices to go down. None of the respondents believe that the serviced office spaces will be much more expensive to rent. And the proportion of those who expect the same price level is the biggest - but still almost 20%-points lower than last year.
6
Initial contract length compared to last year 60,0%
53,8%
50,0% 40,0% 30,0%
44,2% 30,8%
36,4%
15,4%
20,0%
19,4%
10,0% 0,0%
0,0% Shorter
The same 2016 2016
Longer
0,0%
Don't know
2017 2017
In France, the downward trend has continued from last year with more offices signing shorter contracts. There is a small increase in the longer contracts band that might be due to the decrease in the same contract length category. INDUSTRY REPORT
22
FRANCE
7
7/7
General outlook 50,0% 38,5%
40,0% 30,0%
25,4%
23,1% 17,4%
20,0%
21,7% 11,5% 11,2%
8,5%
10,0% 0,0%
41,2%
1,5% 0,0%
0,0% Very negative
Negative 2016 2016
Neutral
Positive
Very positive Don't know
2017 2017
Opinions in France are distributed among all categories. Unfortunately, this year we can see a new band of a very pessimistic outlook, which might be explained by the market instability. However, one third of the respondents still feel positive about the future of the industry.
23
Germany The industry of serviced offices is thriving in Germany: strikingly, 50% of them have more than 90% occupancy, and this situation has remained unchanged since last year. Like in Denmark, prices and contract length remain stable. With these favourable market conditions in mind, it is not surprising that two-thirds of the respondents are positive about the future, and this number is even higher than in Denmark.
GERMANY
1
2/7
Average office occupancy 60,0% 50,0%
38,9%
40,0%
30,6%
30,0% 20,0% 10,0% 0,0%
44,4%
50,0%
5,6%
8,5%
Under 60%
2,8%
4,2%
60% - 69%
8,3%
6,7%
70% - 79%
2016 2016
80% - 89%
Over 90%
2017 2017
In Germany, more than 80% of all serviced offices have high occupancy. Furthermore, the number of those with 90% occupancy has increased by 5.6%-points. Despite increases in both of the lower brackets, this suggests an overall upward trend in German occupancy rates.
2
Occupancy compared to last year 60,0% 47,2%
50,0%
51,6%
40,0%
33,3%
30,0% 20,0% 10,0% 0,0%
13,9% 2,8%
31,3%
11,2% 0,0%
0,0%
Much lower
Lower 2016 2016
The Same
Higher
2,8% 2,8% 3,1%
Much higher
Don't know
2017 2017
Interestingly, none of the surveyed offices has much lower occupancy in 2017. However, this year there is a small band of providers with a much higher occupancy due to the proportional decrease in those with a higher number of tenants. The majority maintain stability for the second consecutive year. INDUSTRY REPORT
25
GERMANY
3
4/7
Occupancy expectation in 6 months 70,0%
59,4%
60,0%
50,0%
50,0%
36,1%
40,0%
28,1%
30,0% 20,0% 10,0% 0,0%
2,8%
8,3% 0,0%
Much lower
3,1%
Lower
0,0% The same
2016 2016
Higher
6,3%
Much higher
2,8% 3,1% Don't know
20172017
Occupancy aspirations are obviously higher in Germany in 2017: only a tiny 3.1% believe there will be fewer tenants. Most providers expect to rent out the same areas as in 2016, and there is a small band of much higher occupancy expectations, which did not exist last year.
4
Achieved prices for office contracts or workstations compared to last year 80,0%
66,7%
70,0% 60,0%
62,3%
50,0% 40,0%
30,6% 29,9%
30,0% 20,0% 10,0% 0,0%
0,0%
0,0%
Much lower
2,8%
5,8%
Lower 2016 2016
The same
Higher
0,0% 2,0%
0,0% 0,0%
Much higher
Don't know
2017 2017
The pricing policy does not look very different against last year’s. Most offices have either the same or much higher prices and this ratio has remained almost unchanged since 2016. INDUSTRY REPORT
26
GERMANY
5
6/7
Expected price level in 6 months 80,0%
66,7%
70,0%
63,1%
60,0% 50,0% 40,0%
25,0%
30,0% 20,0% 10,0% 0,0%
0,0%
0,0%
Much lower
30,6%
8,3% 6,3% Lower
The same
Higher
2016 2016
0,0% 0,0%
0,0% 0,0%
Much higher
Don't know
2017 2017
Most serviced offices do not expect any sharp fluctuations in prices, although almost one third expect them to increase in the next year. This observable trend in the achieved prices will continue in the near future according to our data, which is encouraging.
6
Initial contract length compared to last year 80,0%
66,7%
70,0%
76,1%
60,0% 50,0% 40,0% 30,0% 20,0% 10,0% 0,0%
11,1%
16,7%
12,5%
Shorter
The same 2016 2016
11,4%
Longer
5,6%
0,0%
Don't know
2017 2017
In 2016, two-thirds of the surveyed providers had the same length of contract as last year. In 2017, this band has increased by 9.4%-points, with an almost equal share of those which have rented out their office space for a shorter or a longer period. INDUSTRY REPORT
27
GERMANY
7
7/7
General outlook 70,0%
62,9%
60,0%
49,8%
50,0% 40,0% 30,0%
22,9%
26,9%
20,0% 10,0% 0,0%
11,4% 0,0%
0,0%
Very negative
2,9% 3,4% Negative 2016 2016
16,8% 0,0%
Neutral
Positive
3,1%
Very positive Don't know
2017 2017
This year the number of offices with a positive outlook on the industry has fallen by 13.1%-points: these providers seem to have changed their attitude either to neutral or very positive, with a small proportion of those who have not formed their opinion yet.
28
Italy Average occupancy is distributed among all brackets in Italy, although we can see a positive skew - 50% of all serviced offices have 80% occupancy. Similarly, half of them report higher occupancy than last year. Two thirds of all respondents feel optimistic about the future, and the price level remains relatively stable.
ITALY
1
2/7
Average office occupancy 40,0%
34,5% 28,0%
30,0% 20,0%
20,7% 14,3%
18,8% 13,8%
Under 60%
22,8%
16,1% 10,3%
10,0% 0,0%
20,7%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
2017 2017
Like France, Italy has occupancy rate evenly distributed among all groups. Roughly one fifth of all serviced offices have rented out over 90% of their spaces, which is 2.1%-points higher than last year.
2
Occupancy compared to last year 50,0%
41,4%
40,0%
34,5% 28,5%
30,0% 20,0% 10,0% 0,0%
44,2%
3,4%
6,9%
12,0%
10,3%
15,3% 3,4%
0,0%
Much lower
Lower 2016 2016
The Same
Higher
Much higher
0,0%
Don't know
2017 2017
The figures are promising in 2017. The largest portion of the serviced offices have either more or many more tenants – the increase shows positive movement year-on-year. None of the providers have much lower occupancy whereas the number of those which report fewer tenants has slightly increased. INDUSTRY REPORT
30
ITALY
3
4/7
Occupancy expectation in 6 months 60,0%
51,7%
50,0%
47,6% 38,7%
40,0% 27,6%
30,0% 20,0% 10,0% 0,0%
10,3% 0,0%
8,1%
6,9% 5,6%
0,0%
Much lower
Lower
The same
Higher
2016 2016
Much higher
3,4%
0,0%
Don't know
20172017
Almost half of the offices expect the same occupancy as last year. This figure has slightly diminished since last year. However, there is an apparent increase over the last year’s number of serviced offices hoping for a higher occupancy.
4
Achieved prices for office contracts or workstations compared to last year 75,9%
80,0% 70,0%
72,2%
60,0% 50,0% 40,0% 30,0% 13,8% 12,1%
20,0% 10,0% 0,0%
0,0%
10,3%
15,7%
0,0%
Much lower
Lower 2016 2016
The same
Higher
0,0% 0,0%
0,0% 0,0%
Much higher
Don't know
2017 2017
The price level maintains year-on-year stability, as reported by a substantial majority of the serviced offices. Like 2016, this year has not brought any extreme price changes, and no respondents have reported much lower or higher prices than last year. INDUSTRY REPORT
31
ITALY
5
6/7
Expected price level in 6 months 90,0%
78,6%
80,0%
75,5%
70,0% 60,0% 50,0% 40,0% 30,0% 20,0% 10,0%
0,0%
14,3% 12,7%
10,7% 11,8% 0,0%
0,0%
Much lower
Lower
The same
Higher
2016 2016
0,0% 0,0%
0,0% 0,0%
Much higher
Don't know
2017 2017
The figures clearly indicate that the serviced offices do not expect the status quo to change soon. Based on the already achieved prices, providers make virtually the same predictions about the future.
6
Initial contract length compared to last year 80,0%
67,9%
70,0%
68,7%
60,0% 50,0% 40,0% 30,0% 20,0% 10,0% 0,0%
14,3%
14,3%
8,2%
Shorter
17,7% 3,6%
The same 2016 2016
Longer
5,4%
Don't know
20172017
Two-thirds of the serviced offices experience the same length as last year. The number of shorter contracts has decreased by 6.1%-points this year, while the number of longer ones has gone up by 3.4%-points. INDUSTRY REPORT
32
ITALY
7
7/7
General outlook 70,0%
58,6%
60,0%
64,6%
50,0% 40,0%
31,0%
30,0%
21,7%
20,0% 10,0% 0,0%
0,0%
0,0%
Very negative
6,9%
9,8%
Negative 2016 2016
3,4% 3,9% Neutral
Positive
0,0% 0,0%
Very positive Don't know
2017 2017
Over half of the serviced offices have a positive outlook on the industry with a 6%-points increase this year. One-fifth of the respondents feel neutral, whereas the level of pessimism has slightly decreased.
33
The
Netherlands Although the market in the Netherlands seems to be ever-changing, there are no providers which have a negative outlook on the industry, whereas two out of three expect positive outcomes for their business. A 50% majority expect higher occupancy in the coming months. According to forecasts, prices will mainly remain the same with no sharp fluctuations.
THE NETHERL ANDS
1
2/7
Average office occupancy 40,0%
36,4% 36,8% 27,3%
30,0%
29,8%
20,0% 10,0% 0,0%
9,1% 7,7%
Under 60%
11,8%
15,5%
17,6%
8,1%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
2017 2017
The overall occupancy of the Dutch serviced offices is higher this year. The figures are positively skewed in three higher occupancy alongside with a proportional decrease in offices with lower tenancy.
2
Occupancy compared to last year 40,0% 31,2%
27,3%
30,0%
22,2% 20,0% 10,0% 0,0%
34,8% 27,3%
18,2% 9,1%
9,1%
4,5%
4,1%
Much higher
Don't know
3,2% Much lower
Lower 2016 2016
The Same
Higher
9,1%
2017 2017
The figures show that the market is relatively volatile in the Netherlands. However, the situation is changing for the better this year as one third of all offices have higher occupancy, and the number of those which are less occupied has noticeably decreased. INDUSTRY REPORT
35
THE NETHERL ANDS
3
4/7
Occupancy expectation in 6 months 60,0%
54,5%
50,0%
39,8%
40,0% 27,3%
30,0% 20,0% 10,0% 0,0%
45,5%
5,5%
9,1%
4,7%
0,0%
Much lower
3,6% 4,5%
Lower
The same
Higher
2016 2016
Much higher
0,0%
5,5%
Don't know
2017 2017
This year half of the serviced offices expect a higher occupancy, which is lower compared to last year’s expectations. However, the proportion of those which predict the same occupancy has risen and reached almost 40%.
4
Achieved prices for office contracts or workstations compared to last year 60,0%
50,0%
50,0%
51,5%
40,0% 30,0%
22,7%
20,0% 10,0% 0,0%
25,3% 18,2%
18,1%
9,1% 0,0% 0,0% Much lower
0,0% 0,0% Lower 2016 2016
The same
Higher
Much higher
5,1%
Don't know
20172017
Compared to last year, more offices have higher prices whereas slightly over a half still maintain the status quo in pricing in 2017. For the second year in a row, serviced offices have not reported any sharp fluctuations in prices. INDUSTRY REPORT
36
THE NETHERL ANDS
5
6/7
Expected price level in 6 months 70,0%
59,0%
60,0%
47,3%
50,0%
36,4%
40,0% 30,0%
16,4%
20,0% 10,0% 0,0%
31,8%
5,4%
0,0% 0,0% Much lower
Lower
The same
2016 2016
Higher
3,8%
0,0% 0,0%
0,0%
Much higher
Don't know
20172017
The majority of providers believe the prices will neither grow nor fall. None of them expect the prices to either soar or nosedive. Slightly less than one third expect the rent to be higher.
6
Initial contract length compared to last year 80,0%
72,0%
70,0% 60,0%
47,0%
50,0% 40,0% 30,0% 20,0%
34,0% 19,0%
14,4%
13,6%
10,0% 0,0%
0,0% Shorter
The same 2016 2016
Longer
0,0%
Don't know
20172017
The proportion of serviced offices which have the same length of contract as last year has increased by 25%-points. Naturally, fewer providers this year have confirmed either longer or shorter contracts. INDUSTRY REPORT
37
THE NETHERL ANDS
7
7/7
General outlook 60,0% 45,5%
50,0% 40,0%
30,0%
30,0%
50,9%
27,3% 18,2% 17,7%
20,0% 10,0% 0,0%
0,0% 0,0%
0,0% 0,0%
Very negative
Negative 2016 2016
6,4%
Neutral
Positive
4,1%
Very positive Don't know
20172017
Remarkably, no providers see any negative outlook for the future. Almost 70% of all the serviced offices feel positive about the future and only a small part of them are still uncertain.
38
Spain Roughly two out of three serviced offices in Spain have more than 80% occupancy. Around 50% have reported more tenants compared to 2016 and predicted further growth of tenancy in 2017. The other figures resemble those of the rest of Europe, with two-thirds of all offices having a positive outlook on the industry.
SPAIN
1
2/7
Average office occupancy 50,0%
45,0%
40,0%
40,3%
30,0%
25,4%
20,0% 10,0% 0,0%
7,5% 5,8%
Under 60%
12,5% 12,1%
17,5%
17,5% 16,4%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
2017 2017
Around two-thirds of all serviced offices in Spain report a very high average occupancy rate. Naturally, the number of those with fewer tenants is gradually declining. Overall, the figures look auspicious.
2
Occupancy compared to last year 50,0%
41,4%
40,0%
32,9%
30,0%
25,0%
20,0% 10,0% 0,0%
15,0% 5,0% 3,5% Much lower
17,5%
12,5%
9,8%
Lower 2016 2016
The Same
Higher
8,7% 9,1%
Much higher
3,7%
Don't know
20172017
This chart shows an impressive increase in the number of providers with higher occupancy, as well as in those which have the same occupancy as last year. The other data also point to a conclusion that the industry of serviced offices is expanding in Spain. INDUSTRY REPORT
40
SPAIN
3
4/7
Occupancy expectation in 6 months 40,0%
36,6%
30,0%
25,0%
20,0%
12,5%
10,0% 0,0%
0,0%
24,7%
22,5%
26,5%
15,0% 9,2%
3,0%
Much lower
0,0% 0,0% Lower
The same
2016 2016
Higher
Much higher
Don't know
20172017
Serviced offices in Spain have more optimistic expectations than last year. We can see a noticeable growth by 9.7 and 4%-points respectively in those expecting higher and much higher occupancy. Over one third of the surveyed providers predict that current occupancy will not change.
4
Achieved prices for office contracts or workstations compared to last year 80,0%
67,5%
70,0%
72,0%
60,0% 50,0% 40,0% 30,0%
17,5%
20,0% 10,0% 0,0%
0,0%
12,4%
7,5% 8,8%
2,7%
Much lower
Lower 2016 2016
The same
Higher
5,0% 4,1% 2,5% Much higher
0,0%
Don't know
20172017
The vast majority of serviced offices have maintained the same level of prices as last year. It is an interesting finding, given the burgeoning demand that is expected by many office space providers in the near future. INDUSTRY REPORT
41
SPAIN
5
6/7
Expected price level in 6 months 80,0%
72,5%
70,0%
61,9%
60,0% 50,0% 40,0%
31,7%
30,0%
22,5%
20,0% 10,0% 0,0%
0,0%
2,5%
2,9%
Much lower
3,5%
Lower
0,0% The same
2016 2016
Higher
0,0%
Much higher
2,5%
0,0%
Don't know
20172017
We can see a slight shift from stable to higher prices in comparison with last year. 6.4% of the serviced offices in Spain predict that the prices will go down, and no participants thought that prices would get much higher.
6
Initial contract length compared to last year 80,0%
72,7%
70,0%
56,4%
60,0% 50,0% 40,0% 30,0% 20,0% 10,0% 0,0%
15,4%
17,9%
11,2%
Shorter
The same 2016 2016
13,0%
Longer
7,5%
3,1%
Don't know
20172017
In 2017, even more offices have concluded contracts with the same length as last year: a 16.3%-point growth means that the situation is becoming stable and there is a constant demand for serviced offices in Spain. INDUSTRY REPORT
42
SPAIN
7
7/7
General outlook 60,0%
52,5% 54,5%
50,0% 40,0% 30,0%
20,0%
20,0% 10,0% 0,0%
17,5%
24,2%
9,1%
7,5%
0,0% 0,0% Very negative
Negative 2016 2016
Neutral
Positive
9,7% 2,5% 2,5%
Very positive Don't know
20172017
The negativity has subsided this year, as much fewer serviced office providers have a pessimistic outlook for business. The future looks bright to over a half of the surveyed offices.
43
Sweden The results in Sweden are as encouraging as in Germany and Denmark, with stability and growth in all measures. Over two thirds of respondents report occupancy rates of more than 80%, and a 67% majority believe the overall situation will be even better in the six months to come.
SWEDEN
1
2/7
Average office occupancy 47,1%
50,0%
44,8%
40,0% 30,0% 20,0%
23,5% 17,6% 15,8%
11,8%
10,0% 0,0%
0,0% Under 60%
21,6%
14,4%
3,4%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
20172017
The Swedish market is very lively, with two in three serviced offices experiencing occupancy rates of more than 80%. Some volatility is evident, and the number of high reports has decreased by 4.2%-points since last year.
2
Occupancy compared to last year 50,0% 40,0%
35,3%
30,0%
35,3% 26,7%
17,6%
20,0% 10,0% 0,0%
38,1%
0,0%
22,7% 11,8%
4,7%
Much lower
7,8% 0,0% 0,0%
Lower 2016 2016
The Same
Higher
Much higher
Don't know
20172017
In 2016, more offices reported higher or much higher occupancy. Roughly one quarter of the serviced offices in Sweden have lower or much lower occupancy compared to last year. INDUSTRY REPORT
45
SWEDEN
3
4/7
Occupancy expectation in 6 months 50,0%
41,2% 39,8%
40,0% 29,4%
30,0%
31,5% 24,4%
23,5%
20,0% 10,0% 0,0%
0,0%
5,9%
4,3%
Much lower
0,0% 0,0% 0,0% Lower
The same
Higher
2016 2016
Much higher
Don't know
2017 2017
Almost 40% of all respondents expect the same occupancy as last year. Unlike last year, there is a small band of those who believe that the occupancy will significantly fall. The proportion of those who hope to rent out more space has increased by 8%-points.
4
Achieved prices for office contracts or workstations compared to last year 70,0% 60,0%
52,9%
57,5%
50,0%
47,1% 37,1%
40,0% 30,0% 20,0% 10,0% 0,0%
0,0%
3,4%
Much lower
0,0%
2,0%
Lower 2016 2016
0,0% 0,0% 0,0% 0,0% The same
Higher
Much higher
Don't know
20172017
In 2017, even more providers have the same prices as last year. The number of those who have higher prices has decreased by 10%-points, while there is a small share of serviced offices which have lower or much lower prices. INDUSTRY REPORT
46
SWEDEN
5
6/7
Expected price level in 6 months 70,0%
58,8%
60,0%
62,2%
50,0% 40,0%
29,4% 27,3%
30,0% 20,0% 10,0% 0,0%
11,8% 0,0%
2,9%
Much lower
7,6%
Lower
0,0% 0,0% 0,0% 0,0% The same
Higher
2016 2016
Much higher
Don't know
20172017
Like last year, more than a half of serviced offices in Sweden do not expect the prices to change, although the 27% that expects price rises does outweigh the 10% that expects them to fall. None of the respondents predict the prices to grow dramatically.
6
Initial contract length compared to last year 90,0%
76,5%
80,0%
82,7%
70,0% 60,0% 50,0% 40,0% 30,0% 20,0% 10,0%
0,0%
5,9%
17,6%
8,5%
Shorter
The same 2016 2016
8,8%
Longer
0,0%
0,0%
Don't know
2017 2017
Our figures clearly show that this year even more providers have signed contracts of the same length as before. Naturally, there is a small increase in the shorter contracts band, and a noticeable decrease in the opposite one. INDUSTRY REPORT
47
SWEDEN
7
7/7
General outlook 50,0%
41,2%
40,0% 30,0%
23,5%
25,9%
29,4%
34,7%
32,7%
20,0% 10,0% 0,0%
0,0% 0,0% Very negative
5,9% 6,7% 0,0% 0,0% Negative 2016 2016
Neutral
Positive
Very positive Don't know
20172017
The proportions of providers who have negative, neutral and positive outlook for the industry have slightly increased this year. However, two thirds of the serviced offices in Sweden are optimistic or very positive about the future, which are very inspiring statistics.
48
Asia More than three quarters of respondents expect the same or higher prices in Asia in the next six months.
The Asian market’s occupancy rates are especially encouraging. Average occupancy rates in Asia are extremely high, with 86.3% of respondents reporting figures of higher than 70%. Yet, despite the apparent success of offices in Asia, the year-on-year occupancy rates suggest increased market volatility, with more offices reporting more and fewer tenants respectively. The variance is greater compared to other continents’ data, suggesting that Asian offices have more diverse experience of the state of market than their European counterparts, which could be due to the comparatively small market itself. Nonetheless, over the next six months the price level is expected to increase – three quarters of respondents to our survey expect the same or higher prices next year. Overall, as in Europe, two-thirds of the respondents believe the market is promising, and less than a tenth have a negative outlook, which is an increase on the figures reported in our 2016 survey. Despite some market volatility, it seems clear that providers in Asia are clear about one thing: the figures are going to continue to improve. We can be cautiously optimistic about the Asian market in the 2017-18 financial year, and look forward to following its upward curve in next year’s report.
49
ASIA
1
2/4
Average office occupancy 40,0% 31,8% 30,0%
25,7%
28,6%
31,4% 25,6%
28,9%
20,0% 11,4% 10,0% 2,9% 0,0%
4,6%
Under 60%
9,1%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
2017 2017
Our data indicates that the number of offices with very high occupancy has slightly decreased this year. The number of offices with low occupancy has almost doubled, whereas there has been an increase of 6.1%-point in the 70-79% bracket.
2
Occupancy compared to last year 47,1%
50,0%
40,6%
40,0% 28,6%
30,0%
20,6%
20,0% 10,0% 0,0%
5,9%
17,6%
19,9% 8,8%
6,7%
0,0%
Much lower
0,0% Lower 2016 2016
The Same
Higher
Much higher
4,2%
Don't know
2017 2017
A majority of serviced offices in Asia report the same or lower occupancy this year, although roughly a quarter of them have more tenants compared to last year. This is in stark contrast to most of the European market, where occupancy has been increasing. INDUSTRY REPORT
50
ASIA
3
4/4
Expected price level in 6 months 50,0%
42,9% 37,1%
40,0% 30,0%
25,7%
20,0% 10,0% 0,0%
2,9%
31,4%
34,3%
21,1%
2,9%
0,0%
Much lower
Lower
The same
Higher
2016 2016
1,7%
0,0% 0,0%
Much higher
Don't know
20172017
Interestingly enough, none of the serviced offices expect the prices to fall significantly in the near future. Due to the constant demand, providers predominantly expect the prices to remain the same or increase.
4
General outlook 55,5%
60,0%
48,6%
50,0% 40,0% 30,0%
22,9%
20,0% 10,0% 0,0%
5,7%
8,6% 2,9%
Very negative
26,6% 14,3%
6,4%
Negative 2016 2016
8,6% 0,0% 0,0%
Neutral
Positive
Very positive Don't know
20172017
This year’s figures show that the market is promising in Asia, and perceived positively by over a half of the serviced offices. A distinct year-on-year shift from negative towards neutral attitude lays the groundwork for further growth. INDUSTRY REPORT
51
North America Almost half of North American offices have an occupancy rate of more than 90%
As in our 2016 report, this year’s findings show considerable similarity between the Asian and North American markets. This year, however, North America outstrips Asia to be almost as high as in the best performing European countries: two out of three offices have more than 80% occupancy, of which the majority are in the highest bracket of more than 90% occupancy. Compared to last year, over 40% of providers have reported more tenants, suggesting that new providers in the 2016 survey have continued to grow and gained reputation as a successful alternative to the traditional market, which is a trend that Europe appears to be following also. Worryingly, there has also been a small increase in those with fewer tenants, which could be indicative of a similar sort of market diversity as can be seen in Asia. Most encouragingly, there has been a year-on-year increase in the number of those who expect the profitability will improve in 2017, with almost a 60% increase in those who expect prices to rise. Interestingly, almost one-fifth of all respondents see the industry very positively, no respondents have a very negative outlook, and the general picture is overwhelmingly strong.
52
NORTH AMERICA
1
2/4
Average office occupancy 50,0%
40,5%
40,0% 30,0%
21,4%
20,0% 10,0% 0,0%
7,1%
4,2%
Under 60%
4,8%
24,7%
26,2%
44,8%
23,2%
3,1%
60% - 69%
70% - 79%
2016 2016
80% - 89%
Over 90%
2017 2017
Unsurprisingly, the number of serviced offices with very high occupancy has continued to grow this year and reached an impressive 44.8%, which is indicative of the fact that these providers offer great facilities at competitive prices.
2
Occupancy compared to last year 50,0% 38,1%
40,0%
41,1% 28,6%
30,0% 20,0% 10,0% 0,0%
14,3% 4,8%
32,5%
11,3%
11,9%
9,4% 2,4%
0,0%
Much lower
Lower 2016 2016
The Same
Higher
Much higher
5,7%
Don't know
20172017
The occupancy in North America has risen slightly this year, with no respondents reporting a much lower rate and much more with higher occupancy figures. This positive trend is reinforced by a year-on-year decrease in those with lower occupancy in general. INDUSTRY REPORT
53
NORTH AMERICA
3
4/4
Expected price level in 6 months 70,0%
61,9%
60,0%
53,2%
50,0%
39,7%
40,0%
28,6%
30,0% 20,0% 10,0% 0,0%
9,5% 0,0% 0,0% Much lower
4,7%
Lower
0,0% 0,0% 2,4% The same
Higher
2016 2016
Much higher
2,4%
Don't know
20172017
This year, the number of serviced offices in North America expecting higher prices has increased by 11.1%-points, and fewer of them forecast the prices to remain the same or go down, which can be attributable to the growing popularity of shared workspaces and coworking in both Canada and the US.
4
General outlook 50,0% 38,1%
40,0%
43,2%
26,2%
30,0%
30,5% 23,8%
20,0% 10,0% 0,0%
9,5% 0,0% 0,0% Very negative
4,2%
Negative 2016 2016
19,7%
2,4% Neutral
Positive
2,4%
Very positive Don't know
20172017
In North America, half of serviced offices have a positive outlook for the industry, whereas the number of those predicting neither positive nor negative changes has increased by 5.1%-points, which, alongside higher prices expectations, testifies to the stability of the market. INDUSTRY REPORT
54
One step ahead in commercial real estate industry With leadership and innovation as core values, we always strive to improve the services provided both to our partners and clients. Therefore, MatchOffice is constantly adding new great functions to our websites for maximum comfort of users. Our Virtual Tours, which now can be viewed in virtual reality for a more realistic feel, and the new standard of the photo quality allow providers to reveal all the advantages of their office space to their potential tenants. Further, we continue to grow our network, which now includes more than 5,500 flexible work spaces, for clients to chose from the widest variety possible.
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MatchOffice is keen to follow the latest developments in the serviced office industry. The concept of cooperation and flexibility, embodied in coworking, continues to conquer the world. In 2017, MatchOffice is proud yet again to sponsor the ‘Coworking Europe’, this time held in Dublin.
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