* Preferred Office Club sees strong growth in D.C. market
When we looked at the executive business suites market more than a year ago – worldwide leaders HQ and Regus were struggling to recover from the downturn, and Preferred Office Club, the little guy in D.C., was hoping to build business by serving federal teleworkers.
At the time, HQ was interested in telework, Regus wasn’t. Since, UK-based Regus has bought HQ.
Then business started booming for Preferred Office Club. The firm opened two new centers in September and December, respectively, one on the Metro line in Alexandria, Va., next to the new Patent and Trade Office, the other just north of the White House. “Now three of our D.C. centers flank the White House,” says Angie O’Grady, vice president and chief operating officer of Preferred Offices, which owns four of the six centers.
Four of the centers are at 100% capacity; the two new ones are at 35%. “It usually takes a year-and-a-half to fill a center,” O’Grady says.
Preferred Office Club leases full-time offices to companies that typically need to expand quickly, or need temporary space. For example, Howard Dean leased space for the interim between coming to Washington and being officially nominated as chairman of the Democratic Party; a senator who’d lost his seat in November leased space while mulling over which law firm to join.
Usually, Preferred Office Club leases three to five offices er month. However, since January, it’s already leased 40.
“The D.C. market is one of the hottest in the country right now,” O’Grady says. “It’s not quite as crazy as it was during the tech boom, but the demand is pretty similar.”
Most clients are companies that have busted out of existing offices in D.C.; but many out-of-town firms are trying to do business with the government.
Preferred Office Club is also seeing strong demand for its virtual office program, which accounts for about 25% of the private company’s revenue. The virtual program provides out of town and teleworking clients with a mailing address and telephone answering service in D.C. Yet, it has no plans to pursue telework.
“We had talked a lot about getting more teleworkers, but the existing government telework centers – paid for with our tax dollars – aren’t even being used,” O’Grady says. “How can you help a telework program when the government won’t force their people to use it? No matter how much marketing you do, if the users and bosses don’t see a benefit, it’s never going to happen.”
Another reason the centers are below capacity – federal agencies must pay to use them. “Why should an agency pay for real estate in D.C. then pay for it again in Fredricksburg?” O’Grady says.
The best part of the new boom? “When I do a chart of the different companies and the businesses they’re in, the chart has 10 million colors on it,” she says. “We’re not just doing business with lawyers or high-tech firms. All the sectors are getting it.”
The company plans to open as many as four new centers this year in D.C. and outlying areas, as far north as Annapolis, Maryland, as far west as Leesburg, Va.
