On the 85th floor of One World Trade Center in Manhattan, there are offices, conference rooms, kitchenettes and co-working spaces. There are not, however, very many people. The offices stand largely empty. And that is just fine with landlord Servcorp.
"We now have 40,000 customers that don't actually rent any space from us," said Marcus Moufarrige, Servcorp's chief operating officer. "They can use our space on a casual basis; they can use infrastructure, we've got in telecommunications technology, so their business is really well-represented. And they can use the really valuable address that we've got as part of our network, but they don't actually work with us."
It's called a "virtual office," and it's become a real moneymaker for the Australia-based company. Servcorp has been renting executive office spaces around the world since the late 1970s but only entered the U.S. office market during the last recession, when commercial real estate prices slumped. It took space in several prime locations, and now leases 22 spaces in 12 major cities.
Starting at $250 per month, clients can rent a "virtual office," which includes the fancy address, a local phone number (think Manhattan's coveted 212 area code), a dedicated receptionist to answer calls and receive mail, as well as the option to hold meetings or work in the space a few times a month. Clients can pay more for a dedicated office, a conference room or more "real" time in the space.
"The last 10 years has seen this real growth in small-business opportunity, or the boutique-ification of many industries and the automation of industries brought along by technology," Moufarrige said. "The thing that kills small businesses is rent and people."
The value of the address is also quite formidable, especially One World Trade, the crown jewel in Servcorp's portfolio.