Workspace Operators and Legal Agreements

If you’re running a serviced office business, a shared office or a coworking space then you will have multiple relationships with third parties. These relationships will be with your clients, your partners, investors, service providers and lenders. Each one will be governed by a contract which should to be scrutinised as to its scope, service delivery and avenues for redress.  Here are some of the most important ones:- 

Terms and Conditions with your clients

This agreement will govern your relationship with your client and should always be in writing.  As well as covering the agreed cost of the space, the agreement will also govern issues such as late payments, hours of use, deposits, guests, roll over, auto renewals and termination, utilities, behaviour and house rules. If you sign up clients online, check that the law in your jurisdiction will give force to the contract. Always email a full copy of the agreement to your client. 

Employment Contracts With Staff

The employment relationship between the Business Center and its staff must be formally regulated. Issues include non-complete clauses, confidentially clauses, minimum notice, holiday pay, annual leave and so on. Grievance and disciplinary issues must be set out in written form and the office must have a clear policy on issues such as email usage, discrimination and harassment. Written procedures which are carefully drafted will limit the exposure of the operator to claims under employment law.  

Your Master Lease

We talk about this is a separate post here but suffice to say that your master lease needs to be carefully negotiated. Particular attention should be paid to permitted User clause, Hours of Access, alterations, service charge, repairs, rent reviews and dilapidations. You should also independently  check that the relevant planning consent for office use is in place for your building and don’t just rely on the word of your landlord. 

Legal Structure / Expansion

We discuss this is more details here but as a basis overview we would recommend that any equity partners in the business, future or present, enter into a shareholders agreement. This agreement would govern the relationship between the parties and include provision for the management of the company, director’s duties, ownership and profit sharing. In addition, a shareholders agreement would provide for how disputes would be governed, who would have the casting vote, provision for one partner buying out another (to include right of first refusal and an agreed formula for share valuation), and governing what happens in the event that the business centre operation was sold or a lucrative approach was made from another operator or investor.   Insurance Contracts Under most long term commercial lease agreements your lease the landlord will be responsible for insuring the building but that is not enough for you to relax. You will need additional insurance to cover employers and public liability which wiol to protect your clients, your staff your occupants and their guests. The Business will also need separate insurance to include loss of income and contents cover.  Speak to a reputable insurance broker. 

Intellectual Property/Trade mark registration

As with any piece of property, intangible or real or personal, intellectual property has a value and may be traded. You should consider registering your flexible workspace logo as a trademark. This would offer protection against infringement once you become established and also add value in the event that you ever considered selling the business.


Borrowings of the business can be secured against the business assets to include fixtures and fittings as well as any real property which would include your interest in your building lease agreement. Get advice on the terms of all loan documentation and terms of any asset hire or leasing agreements in particular for your desks and office furniture. 

Anti-Money Laundering legislation

The Law imposes strict obligations on serviced office and shared space providers to identify their clients and retain identity documentation on file both during and after their use of your building. Contact us if you would like a review of your existing procedures and compliance status.

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