"We always planned on expanding in Boston, but this is certainly sooner than we expected," CEO Laura Kozelouzek tells GlobeSt.com, citing a robust response to the temporary workspace company's model, one introduced locally just as the office market finally rebounded from a prolonged slump. Nineteen offices will be carved out of 6,500 sf on Ten Post Office Square's sixth floor, two levels below Synergy's 22,000-sf base of 42 offices and conference rooms, common areas and support services. Boston is among the top candidates for multiple offices in the 10 markets Synergy currently operates, says Kozelouzek.
"We like Boston a lot," she says, confidence borne out in Q1 numbers such as an 8.7% Financial District office vacancy rate and $45.62 per sf average rental rate, according to Jones Lang LaSalle numbers. But while offering that, "when times are good, its good for everybody," Kozelouzek maintains that other factors are boosting demand for shared workspace environments, leading to growth in established markets such as Atlanta and Los Angeles, and the exploration of untapped regions. Negotiations are underway in both instances, says Kozelouzek, although an expanded office in Atlanta is the only one she could discuss in detail, citing confidentiality agreements and ongoing negotiations.
"Generally speaking, we are in a growth mode," says Kozelouzek. There is no established map beyond pursuing "prime markets" to serve the corporate client needing offices in leading cities, she says, and to identify those emerging markets. Synergy is also experimenting with a new product in Atlanta, building out six "mini-suites" that will have their own entrance off the elevator and a more permanent feel. The space is intended for firms needing a bit more longevity and individual image, Kozelouzek says, but also needing an accompanying business center. Although untested, Kozelouzek says she believes the concept will draw interest.
"My sense is that more buildings are going to have to offer this because there is a real need, and it is a growing need," she says. The space will be built out at 191 Peachtree St. as part of an expansion from 25,000 sf to 40,000 sf.
Boston office manager Laurie Snelson says the new space at Ten Post Office Square should be available by June. According to Snelson, market response to Synergy Workplaces was immediate and significant upon its opening last year. Part of the reason, she says, is the building, one that gives smaller firms an opportunity for an address in the Financial District. The rising rental rates also make the concept a more affordable option, she says, and can also offer a middle ground between opening a branch office and having a presence in a market. One client, for example, is a United Kingdom company that has one employee in the Hub and rents out an office on a long-term basis.
"The flexibility is a big part of it," says Snelson. Seeing the response has been gratifying, she says, adding that one benefit of a shared office is the networking opportunities it affords, camaraderie that Synergy tries to foster with special programs and events. "It's a fabulous environment," she says. "People have really taken to it."
Commercial real estate broker Debra Stevens is among those who are renting space in Synergy's Boston office. A principal with the Stevens Group, Stevens says she has had experience with shared workspace companies in the past, and marvels at the model put forth by Synergy, both on delivering services and in the way pricing is set.
"There are no hidden charges," says Stevens, who also concurs that the office fosters cooperation among clients. The Stevens Group is in talks on potential deals with several fellow tenants, she says.
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