Serviced office providers help UAE start-ups hit ground running
Setting up a business in the UAE can be a headache for the uninitiated.
Government rules require firms to have office space before they can apply for a trade licence, and there are numerous approvals to seek from landlords, building managers, and the local authorities to fit out that new office. This process can take months and is a distraction from the main goal – launching and making money as quickly as possible.
This explains why serviced office providers that help businesses get up and running quickly are mushrooming in the UAE.
Regus, the largest flexible workspace provider globally, has been in the UAE for 13 years and its country manager Kory Thompson has noticed an increasing number of competitors in the field.
“It seems like every week there is a new person who’s built a business centre,” he says.
Mr Thompson estimates there are now more than 30 serviced office centres in Dubai and six in Abu Dhabi.
One relative newcomer, MyOffice, operates three business centres in Dubai. Its strategy has been to open centres in “prestigious” locations and offer higher-end services, according to Brad Wylie, a managing partner.
There are a variety of packages and services, from hot desks to offices for as many as 22 people; clients also have use of any of five meeting rooms for eight hours per month. MyOffice also offers help with the licensing process.
A major source of clients is offshoots of large multinational corporations who want to move into Middle Eastern markets.
“If anyone is coming to do business in the Middle East, nine times out of 10 they will come to Dubai first to get their feet wet, test the waters, see how business is done,” Mr Wylie says. “Then they all branch out from there.”
Other clients include those who need space between fitouts and those whose leases have expired.
One is Phil Taylor, the managing director at Team Leisure, which provides consulting services to tourist attractions such as Ski Dubai.
After 11 years of setting up in the offices of whichever client he was working for, Team Leisure took office space in early 2012 with MyOffice.
As manager of a very small company, what appealed to him was the convenience and that all costs were upfront, he says.
“The price they offered was very good,” he says, adding that other companies initially proposed reasonable rates only to pile on additional costs as soon as he requested extra amenities such as tea and coffee, use of meeting rooms and additional internet connections.
“It very quickly became unreasonable,” he says.
Another relative newcomer, UAE Compare, launched its own serviced office package earlier this year in response to demand from existing clients of its fit-out business.
Its “Flexecutive” packages offer ready-to-use bespoke office space with its own reception, meeting rooms, manager’s office and open-plan working space for as many as 20 people. UAE Compare is targeting three types of clients – offshoots of international firms; established businesses that are expanding and looking for extra space; and businesses that are in the UAE for a limited time while working on a project.
“We learnt that clients – as much as we were there to support them in fitting out their offices – were frustrated by all the approval processes Dubai,” explains the UAE Compare cofounder, Bridgett Lau. “A lot of our clients are US-based and they said, ‘Where are all the offices that we can just take? That are set up in such as way that allow us to have meeting rooms and managers’ rooms that we can just brand our own?’ We don’t really have that here.”
The company’s first Flexecutive offices are in JLT free zone but it expects to expand to other locations in time.
Meanwhile, Regus has eight centres in Dubai that suit a variety of budgets. It is also in expansion mode and plans to focus on the lower end of the market by providing cheaper office space to start-ups.
“There is a huge demand for business centres, but the majority of demand we are seeing now is at the lower end,” says Mr Thompson. “That is where a lot of start-ups are now. They are not looking for the prestigious address as much as the office space they need to get the licensing and start their business.”
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Published: December 22, 2014 04:00 AM