Working in a Central Business District (CBD) has long been prestigious and comes with a whole suite of advantages. But many businesses struggle to find office spaces to suit their specific needs, especially in Hong Kong, which is home to the most expensive office rent prices in the world. Reaching up to HK$163 per square foot this November, rent prices have, on average, soared continuously for the past few decades to the extent that finding private office space in the CBD is often unjustifiable. As a result, the idea of co-working and shared office spaces has blossomed in recent years. Through shared office spaces, companies are able to get business addresses in the heart of Hong Kong in places like Central and Admiralty for a fraction of the price. But what benefits are the savvy companies moving their offices into shared spaces receiving exactly?
The History of Hong Kong’s Central Business District
To truly understand why someone might want to move their team to an office space in the CBD, it’s important to understand how these places came about in the first place. When the British first arrived in Hong Kong in the mid 19th century, they established the area, now known as Central, as centre for various military and administrative facilities. Hong Kong’s rapid growth and transition from communities of small villages to an industrial and financial metropolis happened around Central and Admiralty, with people beginning to consider them the heart of Hong Kong. In today’s world, Central and its surrounding districts house an eclectic array of skyscrapers serving as the hub for much of Hong Kong’s financial activity. Unfortunately for many businesses, the demand for office spaces in around Hong Kong’s wider CBD is far too steep, with comparably extortionate rents that, at their peak, have been reported by Jones Lang LaSalle to hit HK$220 per square foot. For context, that’s up to 60% higher than the next most expensive city.
Benefits of working in the Central Business District
But why exactly do people think it advantageous to work in the same district as one another, especially if the rent prices are so high? It all boils down to a few key factors:
- Credibility and reputation: Having an Admiralty or Central address adds prestige to your company. Helping with growth, it boosts the reputation and credibility of your business by legitimizing your business and pitting it against industry leaders who, up until now, are the only ones who could realistically afford CBD addresses.
- Networking: Being in and amongst the business leaders grants you great networking opportunities. Many events are held in these areas and, while being able to meet new people daily provides countless opportunities to create new leads and partnerships.
- Knowledge spill-overs: Being in close proximity to industry leaders can have a knock-over effect. The people you work near to are the same people that will attend events in your area, grab lunches at the same restaurants and have friends and connections nearby that you can easily be introduced to.
- Convenience: Perhaps giving the most visible benefits, convenience is a huge factor. Central and Admiralty are both easily accessible public transport exchange hubs.
Admiralty convenience sans Admiralty rent
Luckily, co-working spaces offer the perfect solution. Offering reasonable rents, many shared office spaces around Hong Kong are offered the chance to showcase their premium features and inclusive business communities. Having a private office within a shared space enables you to share key facilities with other members while still maintaining a dedicated office space for you and your team. Giving significantly more cost-effective rents and thanks to changing perceptions, being in a shared office is no longer an option just for the freelancer and early stage startup. More and more medium and larger sized businesses are making the move as a way of counteracting unjustifiable rents, finding that the convenience and business platform easily trumps that of traditional office spaces.
Rents at shared office spaces in locations across Central and Admiralty are competitive, sitting at around HK$6000-7000 per head, per month for a private office and full access to the communal area. Why bother to sort out the details of a long-term traditional office when the option to move into a flexible shared space is so readily available? As it stands, there are over 2 million square feet of space occupied by co-working in Hong Kong. Not to mention, all the upkeep is taken care of for you by a team whose goal is to make your office as convenient as possible.
Many co-working companies keenly understand these advantages too and use them to shape their individual locations. Scrapping the stereotypical warm and lifestyle orientated designs, they cater towards mature businesses and those in industries like finance and its extended professional services wishing for an address in HK’s CBD with minimalistic and productive interiors. What they find in a shared office is the perfect mix between a productive work environment, flexible and reasonable terms, and bountiful networking opportunities. Being able to step outside of your customisable private office into a communal area that’s all but a minute walk away from the closest MTR is a luxury many businesses would miss if it were not for the option for a shared office.
In sum, while working in the CBD has a whole range of benefits such as extra credibility, convenience and networking, many businesses have a hard time justifying the extortionate rent prices for traditional office spaces. But with the recent uptake in the number of co-working spaces in the Central Business District, businesses now have another option. A shared office space offers all the benefits of traditional workspaces (and often more) but without the ridiculous rent prices. Achieving this through making use of communal spaces and sharing facilities, co-working companies such are creating an environment that fosters not only the sociability and networking ease co-working has become synonymous with, but also a productive and minimalistic environment to foster business growth.
Interested in being part of an inclusive business community in Hong Kong’s CBD? Contact us today to learn more.