Effects of rising energy prices on the office market – Interview with Balázs Csorján
When choosing an office space for your business, expenses are undoubtedly one of the most important aspects to consider.
The average office cost depends on many factors such as location, size, on-site amenities, nearby junction and more.
It is usually up to the HR manager, country manager or CFO to decide what type of an office is needed and how much they are willing to spend on office rent.
As the COVID-19 pandemic changed the location of work in many industries around the world, and because of the current rising energy prices, we were curious to get to know about how these factors are changing the operations of office buildings in the short and long term. We asked Balázs Csorján, Business Development Manager of DBH Serviced Office:
– How do you see the office market change with the increase of energy prices?
– How do you see the office market change with the increase of energy prices?
During the COVID pandemic the office market became highly segmented. Increasingly, the focus has been on the user experience. Offices offering premium services have seen higher turnover. During the energy crisis, segmentation seems to be even more pronounced. Those who are serious about the energy efficiency will benefit. The future is definitely for new, premium, environmentally friendly office spaces (just like Skanska’s buildings). This is why the DBH Group has chosen office buildings designed and built by Skanska. Located in business districts, to perfectly serve all the clients’ needs. Our office buildings meet strict international standards and we pay particular attention to sustainable building management solutions.
– How does DBH Serviced Offices optimize the rising energy costs?
– How does DBH Serviced Offices optimize the rising energy costs?
We have many buildings with district heating and gas boilers, even in new office buildings. Our company DBH recognised during the pandemic that large corporate clients are increasingly open to premium but flexible office solutions. There was no question that the DBH Group would develop in this direction, and to do so we needed centrally located and high-quality buildings.
For example, Equilibrium 1 is a 12-storey Class A office building with 20,700 sqm of lettable space and 3,500 sqm of green space.
When designing this office building, our developer made an effort to use 100% energy from renewable sources, and we succeeded.
– In light of the changing energy costs will the rent for existing customers remain the same?
– In light of the changing energy costs will the rent for existing customers remain the same?
Yes, the rent of the building is the return on investment in the property and landlords do not like to change this.
However, the other two main office costs, the service charge and the energy costs are subject to change. It is important to mention that the monthly rent covers most of the costs of the main services and facilities. On the other hand, there may be additional costs for extra services. For example, some clients did come to my colleagues with requests such as dry cleaning which are not included in the price, but of course we will endeavour to maximise our ability to meet our clients’ needs in these more difficult times.
– What kind of office space do you recommend for those companies that are in deficit due to the increase in energy costs or realise less profit?
– What kind of office space do you recommend for those companies that are in deficit due to the increase in energy costs or realise less profit?
If the company is close to the end of the contract, in these uncertain times, you should not commit for a long term (5-10 years), even 3 years I feel too long. Therefore, I would definitely recommend a flexible arrangement. In this case we usually mention the advantages of a serviced office to our prospective and existing clients. The costs of a serviced office depends on a lot of factors, but generally we can say: flexible office monthly costs are above conventional office costs with 0-30%.
