Traditionally, successful companies worked out of big-city offices, but there has been a notable shift in the last few years. Many are moving to the outskirts of town, with the rise of hybrid working being a big catalyst. With virtual meetings now facilitating face-to-face contact, businesses are thinking twice about the need for a city-centre presence.
They’re questioning whether the high costs of city office space are still justifiable and whether being in the big smoke is even essential to their success. Many are coming to the conclusion that not only is it not necessary, but there are distinct benefits to getting out of the city.
Out-of-city working means lower operating costs, particularly in fully serviced offices. It also reduces the time spent commuting for employees, giving them a better work-life balance. Plus, by being out of town, businesses are not restricted to a fixed workforce and can cast their net further to find the right talent.
So, what does this trend mean for the world of work? Why are companies heading out of the city and into the suburbs? What are the consequences for workers and the job market? In this blog, we'll explore the benefits and look at successful companies that make it work.
As a leading office space provider in Hampshire, Arena Offices embraced this shift long ago, recognising the growing demand for flexible, well-connected workspaces outside congested city centres. That’s why we offer 11 serviced offices across the South, strategically located on the outskirts of major towns and cities - providing businesses with the perfect balance of accessibility, convenience, and cost-effectiveness.
Contact us today and come and see the difference for yourself.
What does it mean to be "out of the city"?
When we say "out-of-city", we don't mean upping sticks and relocating to some remote, rural neighbourhood in the middle of nowhere. We mean office space on the outskirts of towns and larger cities like Southampton and Portsmouth. Think suburban streets, business parks and industrial estates that are close enough to town to be convenient but far enough away to benefit from lower costs.
Why have companies been moving out of city centres?
The pandemic forced employers to re-think their stance on home working, and it’s since become the norm for many employees. Technology has enabled greater connectivity, and a lot of people simply don’t need to be in an office five days a week.
But empty desks are expensive – especially considering the eye-watering cost of office space in city centres. Hence, there has been a rise in the move to private and serviced offices just outside of town. Not only are they more affordable, but they also offer the flexibility to up or downsize office space as needs change.
Evolving employee needs are also driving the shift out of central locations. People are shunning city centre working to cut their commute and benefit from lower travel costs. With some employees in central London spending as much as 10% of their earnings on commuting, it's a big issue for job seekers, and out-of-city offices can be a big selling point.
How will this affect local businesses?
As major companies move their offices away from city centres, local economies stand to benefit. With more people working in smaller towns and suburbs, there’s a growing demand for local cafés, shops, and services.
Instead of pouring money into expensive train fares or long commutes, workers also have more disposable income, and their chances of homeownership can increase. So, it can be argued that the shift not only revitalises high streets and boosts local businesses but also creates stronger, more self-sustaining communities.
Benefits of out-of-city business hubs
Access to a more diverse talent pool
While major cities are home to a large number of skilled professionals, companies face stiff competition to attract them. By spreading their workforce across multiple locations, they can look further afield to neighbouring regions. It's also great news for job seekers who don’t want to relocate to the city for a new job or find the thought of travelling to the city too stressful (and expensive).
Cost savings
With office rent and overheads soaring, many businesses are struggling to maintain their profit margins. In the past few months alone, the government has introduced changes that have hit SMEs hard, such as the increase in Corporation Tax, Employers' National Insurance, and the national minimum wage. Combined with ever-increasing energy prices and inflation, city-centre offices have become even less viable.
That's why so many are realising the cost-saving opportunity - why pay city premiums when you can thrive elsewhere for half the cost? By relocating to less expensive areas, companies can allocate resources more efficiently and, ultimately, enhance their bottom line - even more so when they save money with serviced offices.
Better quality of life for employees
We are all becoming more aware of how employee wellbeing is essential to a company's success. Much has been written about how a better work-life balance results in more productive employees and higher staff retention (see our blog on how to promote wellbeing at work).
While the lure of urban life appeals to many, long commutes, busy trains, and city crowds can be extremely stressful for others - hardly conducive to a successful day's work. Moving to an out-of-city office can reduce commuting times and give employees more time to fit in things like exercise and spending time with their children. Moving an office just 10 minutes outside the city centre can reduce employees' commutes by hours each week, seriously improving their quality of life.
Arena Offices are designed with wellbeing and collaboration in mind. Our clients have easy access to open spaces and breakout areas, encouraging them to leave their desks at lunchtime and take regular breaks. At our Grosvenor House centre, workers can even enjoy a roof terrace and onsite gym.
Better for the environment
Sustainability is a hot topic, and companies are under increasing pressure to reduce carbon emissions and operate in a more environmentally responsible way. Moving away from large city offices helps companies meet their sustainability goals by cutting down on commuting, reducing energy consumption, and promoting greener working habits.
Modern serviced offices outside major cities are often designed with sustainability in mind, featuring energy-efficient buildings, smart resource management, and eco-friendly workspaces. Out-of-city working isn’t just good for employees and businesses - it’s also a step towards a cleaner, greener future.
What industries benefit most from out-of-city working?
Here are a few sectors and business types that thrive in out-of-city business hubs:
- Technology and IT – Many tech companies now allow home working or hybrid working, making it easy to set up smaller office hubs in regional areas.
- Financial services – Banks and insurance companies often have regional offices to serve customers in different locations.
- Manufacturing and engineering – These industries require large office spaces and facilities, which are more affordable outside major cities.
- Creative and digital industries – Designers, marketers, and content creators can benefit from flexible working environments outside city centres.
- SMEs - Serviced offices offer smaller businesses flexibility, networking opportunities, and significant cost savings.
When big companies start moving out of the city, you know they are on to something. Let's take a look at some household names that have successfully adopted out-of-town working.
Barclays Bank
A giant in the banking world, Barclays has decentralised its operations back in the 70s, with the aim of improving efficiency and tapping into regional talent pools. Today, these hubs house various departments, including customer service, technology, and administrative support.
Jaguar Land Rover
Jaguar Land Rover is a prestigious name, and you would expect it to have an equally prestigious city-centre address. But its headquarters can be found 10 minutes outside Coventry city centre in Whitley. It also has a number of engineering and design centres in suburban and rural locations, which are essential in accessing specialised automotive talent.
GSK (GlaxoSmithKline)
GSK has established research and development (R&D) out-of-city business hubs in various locations across the UK to focus on biotechnology, chemistry, and clinical research. By locating its R&D function outside of major cities, GSK can access specialised talent, as well as collaborate with universities.
Find your perfect out-of-city office with arena offices
With 11 prime locations across the South, including Basingstoke, Camberley, Fareham, Southampton, and Winnersh Triangle, Arena Offices provides modern, flexible, and cost-effective workspaces. Each of our centres is designed to help businesses thrive outside congested city centres but have great access to major travel links.
We believe that premium office space shouldn't cost the earth and that coming to work should be a pleasure. Discover our perfect balance of convenience, great facilities and affordability today.
Ready to make the move? Get in touch to book a tour and discover how our out-of-city offices can support your business growth.
We've been a happy client of Arena for 6 years. The offices are modern, welcoming, well maintained, cost effective and the staff are always friendly and helpful. The Basingstoke location is great for parking, close proximity to the station, shops and the gym. We'd happily recommend Arena for your serviced office requirements.
Nicky Allcock