3 challenges when renting an office in Hong Kong
As a business owner, renting your own office space might sound exciting, but the truth is that renting an office in Hong Kong is not an easy process as it involves tedious paperwork and hidden costs that go beyond the monthly rent.
Granted, some large corporations need their very own facilities. But does that mean your small business really needs it too?
If you are looking to rent an office space in Hong Kong, then this article is for you. Here we’ll tell you the 3 costs and (sometimes hidden) expenses to consider before renting an office in Hong Kong. Also, we’ll introduce you to a much more affordable and better alternative to traditional offices: coworking spaces and serviced offices.
Renting a private office in Hong Kong is not cheap.
Renting an office in Central Hong Kong costs an average of around HK$72 per ft² a month. Considering that offices in Hong Kong are rarely smaller than 325 ft², renting a tiny office that fits only 3 people could cost around HK$22,500 a month, which translates to HK$7,500 per employee in rent alone.
On the other hand, renting a private office in a coworking space costs as little as HK$2,500 per person per month depending on location obviously and about HK$4,500 per person per month on average. This usually includes 24/7 access, a fully hosted space, phone booths, meeting rooms, printers, lockers, free coffee, community events and unlimited Wi-Fi. Alternatively, a dedicated desk in a shared space can start from around HK$2,000 per person per month and about HK$3,500 on average. Lastly, coworking hot desk will give you the most flexibility with hourly, daily or monthly access at the cheapest rate, from HK$150 per person per day and about HK$300 on average.
Coworking spaces are shared, serviced workspaces in which workers from different companies use the same facilities, allowing cost savings through the use of common areas. Most coworking spaces offer private and semi-private offices within their buildings, which provide the same benefits to leasing a full office but for a fraction of the price.
When renting office space in Hong Kong, you will not just receive a single bill each month, but many.
Rent is usually a fixed expense, so there are no surprises there. However, renting an entire facility is in many ways like renting an apartment: you will have to separately pay the utility bills (water, electricity and Internet), acquire new furniture, office equipment, office supplies, security systems as well as pay for janitorial services and repairs when necessary.
These variable costs can quickly add up and end up doubling or even tripling your business’ monthly expenses. All together they could easily cost more than rent. Plus, keeping track of all these expenses takes time and becomes a constant distraction for whoever is in charge of the office management.
If your business is not ready to face these challenges, a coworking space is the right alternative.
Most coworking spaces in Hong Kong offer both shared and private spaces. Both options are usually available at a fixed monthly price that includes everything from utilities to furniture. This option simplifies the process of getting an office space and makes it easier for your business to forecast monthly expenses. Which gives you more control over your budget, allowing you to focus on what really matters: your clients.
If you lease an office in Hong Kong, you will most likely be required to sign a tenancy agreement. In Hong Kong, a tenancy agreement is a legally binding contract which states the rights and obligations of both tenant and landlord during the lease term.
In simple terms, this means that you will most likely:
- require professional advice to ensure you understand everything stated in the long contract; which costs money and takes time.
- be asked to rent the office for a minimum of two or three years; something most small businesses can’t commit to.
- cover additional costs, including legal fees, taxes, insurance, deposits, advance rental payments, etc; which adds up to all the fees we already mentioned.
In contrast, renting a private office in a coworking space is as simple as applying, getting accepted, and making monthly payments. Most coworking spaces do not require businesses to sign long-term leases and offer a simple onboarding process.
If you don’t have the time or the money to hire lawyers, if you don’t want to deal with complicated contracts, if you cannot commit to a two-year lease, or if your business can’t afford all the costs of signing a tenancy agreement in Hong Kong, then a coworking space or serviced office is exactly what your business needs.
Finding the right coworking space or serviced office for your business in Hong Kong
If you are still on the fence about whether to rent an office space or not, we encourage you to check out the coworking spaces available in your area of preference.
How to do it? Easy. Just go to our Coworking Spaces in Hong Kong page and filter by location and type of space. You’ll get instant access to all the coworking spaces available in the area, their monthly fees, photos and full details about how the memberships work.
You can also schedule an appointment to go see the space or even work from there for a few hours before you make a decision.
Learn more about coworking spaces and flexible workspaces here.