Economy, Domestic Economy

Servcorp Opens 1st Tehran Branch

Servcorp is planning to open 10 branches in Iran.Servcorp is planning to open 10 branches in Iran.

Servcorp, an Australia-based multinational organization that sells serviced office space, virtual office products and IT services, officially inaugurated its first branch in the Iranian capital city of Tehran on Dec. 3.

The company is planning to open 10 branches in Iran, as business relations between Iran and Australia are expected to strengthen, Trend News Agency reported.

Australian Ambassador in Tehran Jan Biggs attended the ceremony that gathered some international businessmen and clients.

Servcorp was established in 1978 and listed on the Australian Stock Exchange in 1999. As of June 2016, it operates in 150 business centers in 52 cities across 21 countries.

The company was founded by Alfred Moufarrige in 1978. In 1980, it pioneered the virtual office concept.

A virtual office provides communication and address services for a fee, without providing dedicated office space. It differs from “office business centers” or “executive suites”, which do provide physical office space and/or meeting rooms.

Speaking during the ceremony, Biggs said the removal of sanctions on Iran has sparked great hopes for expansion of business ties between the two countries.

In September, executives from GrainCorp, WorleyParsons, LiveCorp, Oil Search, Qantas, Sydney Univer­sity and Rubicon Water traveled with Trade Minister Steven Ciobo to Tehran where they signed several MoUs.

“We are in the dawn of a new age of the relationship with Iran,” Ciobo said at a gathering of business leaders in Tehran back then.

  Lack of Modern Office Spaces

Iran’s nuclear deal has opened the gate for business expansion and foreign investment, but this growth faces an obstacle: a dearth of high-quality, affordable office space, forcing many foreign companies and big domestic employers to make do with office space attached to malls or shopping centers, reads a Guardian report.

Modern offices of any sort also are hard to find in the capital, because so much of the real-estate investment of recent years has gone into residential towers. Houses and apartments have long been seen as a stable hedge against the economic headwinds of the sanctions era, but comparatively little money has gone into commercial structures.

Mohammad Ghaemi, an architect who has worked on office buildings and commercial complexes across the country, believes one reason for the thin stock of high-grade offices, most prominently in Tehran, is lax building standards set by the authorities.

“Office buildings have been built but without professional standards,” Ghaemi said. “There is demand for offices, but offices are not professional.”

The lure of setting up offices in residential space is also high, thanks to the bureaucracy in Iran. 

“Because it’s very cheap to set up in a residential unit, many people convert their residential units to office units,” says Maryam Kiaie, the international business development director for Rah Shahr, a major Iranian infrastructure firm.

The stresses in the office market could ultimately lead to a fresh wave of investment in commercial buildings, especially if the economy improves further in the wake of last year’s nuclear deal.

So far, though, while many companies have explored setting up shop in Iran, commitments have not reached the level necessary to support a rebound in office construction.  “Despite sanctions being lifted, the money has not flown in yet,” said Nicholas Gilani, an executive at the Dubai-based CommoditEdge who has done extensive work in Iran.

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