When serviced-office operator Boutique Workplace Company (BWC) was founded in January 2015 it was a fairly low-key launch.
Part of the Moorgarth Property Group, owned by South African retail entrepreneur Christo Wiese, BWC was catapulted into the limelight with the purchase of Sunday Times Virgin Fast Track 100 member Ventia, which operates 23 business centres with more than 2,500 workstations across central London, in December. Property Week caught up with BWC’s managing director David Hall and Moorgarth’s finance and commercial director David Harrop, who managed the Ventia acquisition, to find out about the company’s plans for the future.
Why did the BWC decide to branch into serviced offices?
Harrop: “Our main business is property investment - we own lots of commercial property around the country. Our core product is retail and shopping centres in particular, but we’ve bought a considerable number of office buildings in London in the last 18 months and as a landlord you’re always looking to get your space occupied, so the serviced-office market is complementary to our core property investment business.
“We think it’s a particularly good market in London because lots of businesses from all over the world want to have a presence in the capital.
“We brought David Hall in to set up and run our own serviced-office division because he’s a sector specialist and we launched using our own buildings, but then the Ventia opportunity came up and it was a chance to make a step change in terms of the nature, scale and growth of our business.”
What attracted you to Ventia?
Hall: “Initially, it was the style and scope of its buildings: they were a similar fit to some of the ones we operate.
“One of the key things for me, once we’d got to know the company a bit better, was its focus on customer service and the way it wanted to run the buildings so that they were tailored to the demands of individual clients. That was very much in tune with how we wanted to grow as a business as well, so there was a good synergy both in terms of the property, and the way it wanted to present itself to its customer.”
What was the thinking behind the company’s name?
Hall: “First of all, ‘boutique’ says a little bit about what we’re about. It means we’re a little bit more personable, we’re smaller and we’re independent. We’re not a large anonymous serviced office. Our offer is more tailored to the individual.”
What’s the company’s USP?
Harrop: “We have distinctive, characterful properties. We’ve got properties in the West End, in Shoreditch and in the City, and no two are exactly the same. Sometimes serviced space is bland, uniform and a bit anonymous, but we want long-term occupiers who don’t see serviced offices as a short-term thing. Our office becomes their office and we want them to be happy in a pleasant building that’s in a good location with competent and attentive people on site who can take the property issues away from them so that they can concentrate on running their business.”
How serious is the company about the serviced-office market?
Harrop: “We’re not dipping our toe in the market to test the model. We’re well aware of the sector and we like it. Ventia isn’t a small transaction. It’s adding 20-odd centres across London, 2,500 workstations and a number of staff, so it’s a decent deal for all parties. We like the people, we like the brand, we like the buildings, we like the location. It’s been a good transaction for all.”
How do you intend to grow the business going forward?
Hall: “We are in terms for a couple of new sites already. We’re looking at central London for our initial expansion, but also for opportunities where there is strong demand in future growth areas. We’ll look at anything. If an acquisition is there that will help and assist us in growing and it’s a good fit, then we will look at it. But also if there are leasehold and freehold opportunities out there we will take those as well.”
Do you have a war chest set aside to fund expansion?
Harrop: “We’re ultimately part of a listed group with access to various reaches of capital. We’re relatively lowly geared and as our track record shows this year we’ve not been afraid to invest in good opportunities. We’ve got a scalable model and a structure in place so when we add extra properties we can incorporate them and our structure flexes so we can maintain service levels to our clients. At the moment we’re very focused on bedding in Ventia - we don’t feel the pressure to do another deal, but if one came across our desks we would look at it.”