Options for Singapore Business Office
Setting up a business office in Singapore can be challenging and time consuming. Small and mid-range business enterprises need to consider different factors like finance sourcing and projected revenues plus profit margins when renting an office to run a business. A business office will definitely have an impact on the over-all performance of a company.
Singapore is considered as one of the best commercial hubs in the world. As such, it has myriads of business types setting up offices in the country. Office rental is a very important concern for any enterprise that wants to operate in Singapore. Choosing the right office spot plays a big role in the success or failure of businesses that primarily deals with customers.
Selecting the best location to conduct business is very important. Prime spots often command prime prices as well. A thorough research of suitable offices for lease that provide both convenience and functionality is important especially when a company’s operating budget is limited.
This report offers a comprehensive look at different types of business rental options for anyone planning to run an enterprise in Singapore. It provides basic information on office types that will help companies in finding the most appropriate business site solution for their needs.
Serviced Offices
Singapore has a number of specialized companies that provide business rental space in the business hub of the country. These business offices are fully-equipped and ready to use. The office can accommodate anywhere from one individual up to ten staff. This is an ideal option for small companies as it provides them with a place to conduct their business without worrying about physically setting up an office. Serviced offices allow flexible lease terms and offer the advantage of being located at prestigious addresses. After signing the contract you can start your operations from next day. Regus, APBC offices, Servcorp, greenhub are some of the companies offering these kind of setup options.
Advantages of Serviced office
Fully equipped and ready to use
Serviced offices are readily available for occupancy and use. Operational needs like internet connection, IT infrastructures, reception service, mail support, and telecommunication needs come with the leasing package. Office equipment are also included along with perks like staff refreshments. Basic utilities needed to run an enterprise successfully, like electricity and lighting, air conditioning, and janitorial services, are also provisioned.
Flexible Lease Agreement
Lease terms depend on the needs and preference of business owners. This provides flexibility as the rental term can be on a monthly basis. This condition helps avoid huge capital expenditure on leasing an office space.
Shared facilities and amenities
Small start-up business may find it financially challenging to lease offices with meeting or conference rooms and have office equipment like photo-copiers. Serviced offices provide these amenities and facilities that are shared among other leaseholders. Some serviced offices even provide terminal link or “hot desk” for all their tenants.
Prime location
In business, location brings prestige to any company. Serviced offices are often located in prime business spots in Singapore. This gives any business the advantage of being in the cream location within the country.
Room for expansion
As a business grows, so is its need for a bigger office space. A serviced office allows physical expansion of the business as more office space can be leased. This is a more practical solution than relocating to a bigger location.
Convenience
Being in major business areas in Singapore, serviced offices offer easy access to transportation routes like major highways and MRT stations. This is most advantageous for both staff and clients as the company can easily be accessed.
Disdvantages of Serviced office
Comparatively higher rental cost
All convenience and amenities of renting a serviced office in business centers come with a cost. Compared to a conventional office, leasing a serviced office is a not a cheap option especially if it is for a long-time operation. In general your rental will range around 15- 20 SGD per square foot per month for an A class center in city central area.
Scheduling conflict in using facilities
Facilities like conference room may not be available at a moment’s notice, thus the need for a close coordination with other tenants. This also stifles any emergency meetings or can prove to be a challenge if there is a surprise visit of clients or customers.
Business recognition
As the serviced offices house a number of leaseholders, a company’s name may not be easily recognizable as it is stacked with the names of other businesses operating in the same building. At times, this gives an impression to clients that the company is unstable and small.
The monthly cost of leasing a typical serviced office in Singapore that can seat two to three employees is from S$2,000 to S$3,000. The cost will largely depend on location and proximity to services like MRT, bus stops and the other conveniences.
Typical rented your own business office
A Singapore typical business office is simply an empty space that the needs to be furnished. It does not have furniture, utilities, IT infrastructure, and other amenities. It entails a significant amount of cash outlay to make it functional, but it is more advantageous for companies that are more stable and have more employees.
Advantages of your own office
Design flexibility
As you will only be renting a space, you will be able to design the layout of the whole room based on the functions needed to operate the business.
Security of tenure
Leasing a conventional office provides a company with location security. Lease can be long-term and rental fee increase is predictable. Lease agreements can also include renewal at pre-agreed terms and conditions. It also helps avoid expensive relocation to a bigger site that oftentimes disrupts the conduct of business. Generally the lease tenure will be 2 or 3 years.
Variety of site choices
Compared to serviced offices that are mostly located in the business hub of Singapore, business owners can select locations for their companies in other parts of Singapore. There are more options available for leased office spaces.
Cheaper in the long run
Although the initial cash outlay is significant, leasing a conventional office will prove to be more cost-effective in the long run. In a A-class building in city center the going rate is 10 SGD per square foot per month.
Provides better lease option for non-customer facing businesses
Companies that seldom deal with customers will find it more beneficial to rent an office space as they only need to set up basic office needs to operate the business. Start ups can negotiate favorable lease agreements to minimize operational cost.
Disadvantages of having your own rented office
Long-term lease
Private office lease in Singapore is at least two years. For a start-up company with unpredictable future, this may not be the best option.
Huge initial operational outlay
Getting the office ready for operation will entail huge cash outlay to buy furniture and to set up facilities to conduct business. As a general guideline plan 20-30 SGD per square foot as your renovation expenses.
Unpredictability of space
Companies may not be able to predict their business growth and need for space which can result to renting an office space that don’t suit their needs. In other scenario, if your business grows beyond your expectations then you may not have many options for expansion unless you rent another office which may be in different building.
Maintenance
As the company will be functioning fully on its own, it has to manage all its operational requirements including housekeeping, office and utilities maintenance, IT set up, mail handling, answering services, reception, and others.
Virtual Office
Serviced office centers also provide virtual office option for businesses operating in Singapore. This alternative allows a business owner to run his enterprise without renting a physical space. The package typically includes the use of:
• Corporate business address;
• Communication facilities like phone forwarding and fax numbers;
• Personalized telephone answering system;
• Mail handling capability;
• If needed, secretarial services, meeting rooms, or private offices.
As the services are in “per need” basis, owners can just select and pay for the type of service they need. It provides a cheaper and more practical option as it does not require a big capital investment involved in setting up a physical office. This type of office is most advisable for:
- Foreign business that want to establish business presence without hiring any staff;
- Home-based entrepreneurs that needs to establish credibility by having an official address.
- Small entrepreneurs with existing physical office outside of the prime business spots but need to build their corporate image by having an address in the country’s main business hub.
Home Office
A home office is officially defined as a “premise used by its occupants primarily for residential purposes with part or parts of the premises being used by the occupants as an office”. This type of office unit is applicable to employees that work at home, lawyers, real estate agents, consultants, and individual businessmen. Home Office Scheme of Singapore regulates this office unit type and business owners must conform to the guidelines for home office set by the agency.
Individual business owners who wish to run their venture in their homes must register with Housing and Development Board. For those residing in private domiciles, the permit to operate a business at home will come from Urban Redevelopment Authority. All people engaged in home office must be residents, owners, or tenants of the residential premise. Aside from this, the following guidelines must also be adhered to:
- There must be no smoke, noise, or other pollution generated from the home office;
- Non-resident employees must be limited to two only;
- No signboards or advertisements can be displayed in the premises.