Serviced offices rise in popularity as demand for grade-A space wanes
As banking sector sheds staff, individuals are setting up their own businesses and seeking executive space to house their new operations
The office sector in Hong Kong has been a tale of two markets, with leasing demand for grade-A office premises in prime business locations falling amid global financial turbulence, while demand for serviced office space has been rising.
The rise in demand for serviced offices has been driven by the demand from the finance sector, said Paul Salnikow, chairman & chief executive officer of The Executive Centre, an Asia provider of serviced office space with video conferencing facilities located throughout its network of 50 centres across 18 cities.
"The wave is currently ongoing, having begun about a year ago. The trend can be defined as bankers and financial services people leaving the big banks and becoming entrepreneurial by opening their own firms," said Salnikow.
As a result of the uncertain outlook for the global economy, many employers, especially those in the banking and finance sectors, were forced to downsize head counts and freeze budgets last year.
The Executive Centre's banking-related client base in Hong Kong rose to 51 per cent in January 2013 from 29.5 per cent in January 2010, he said.
In 2012 alone, more than 102 banking sector people set up shop in The Executive Centre.