When Mark Dixon was on a business trip to Brussels, Belgium, he was struck by the lack of convenient short-term office space for visitors. Believing there was an underserved market, Dixon founded Regus in 1989, specializing in short-term, flexible office leasing for clients.
The company, which is publicly traded on the London Stock Exchange, has since expanded to over 92 countries with 1,200 locations, and with the soft economy, it is poised to continue growth.
In Manhattan, as vacancy rates narrow and rents rise, the company is seeing interest from tenants seeking more affordable rates, as well as companies that don't want to be tied to a long-term lease.
The down economy is an opportunity, said Colleen Susini, market director of Manhattan for Regus. We're in growth mode.
Regus has space in 25 properties in New York, totaling around one million square feet, including spaces in trophy buildings like the Chrysler and Helmsley, as well as more mid-market properties. It has around 90 percent occupancy in its local portfolio.
Earlier this month, Regus leased 52,274 square feet at 112 W. 34th St. It plans to open three more Manhattan locations in the next quarter.
Regus leases one or two floors in a building, or around 2,500 square feet, and subleases various types of offices to clients. People who work from home can use the company's mail and telephone services and book space for meetings, while companeis entering a new city can take temporary space for a few months.
Rates start at $25 per month for access to offices, and individual offices are $400 per month. Typical leases ranging from three months to years. Clients include both startups and Fortune 500 companies. Finance and legal industry make up a substantial amount of tenants in New York, but clients also include technology, media and other sectors.
The insurance company Aflac has leased around 400 square feet at Regus' space at 770 Water St. in Lower Manhattan, its first New York City location. After searching for space in around 20 other buildings, the company was drawn to the the office's river views and pristine decor.
It's really beautiful, said Christina Houk, one of Aflac's employees. Everyone who comes through here comments on it.
Details in the office are standardized across Regus' properties -- down to the type of candy at the front desk -- based on consultation with the company's design team in Texas. The goal is to provide a comfortable, familiar environment for clients, said Susini. The office spaces are also prebuilt, saving tenants from construction costs, as well as utility fees.
Nationally, Regus is also expanding, with new locations in Salt Lake City, Utah, Omaha, Neb. and Santa Monica., Calif.
We are entering new markets in the U.S., while at the same time expanding in existing markets, said Guillermo Rotman, CEO of Regus, Americas. Because of technology and the growing number of mobile workers, people are working everywhere. And we can help people work more effectively anywhere they want, whenever they want in a flexible environment that suits their needs.