Seven out of 10 domestic startups are considering moving their offices to preemptively respond to the burden of rent and the slowing economy, the survey showed. Although the Gangnam area (GBD) is still the best area for startups, many startups prefer urban areas (CBD) such as Gwanghwamun, City Hall, Euljiro, and Jongno.

According to a survey conducted by commercial real estate data company Alsquare (CEO Lee Yong-kyun) on startup officials from the 9th to the 31st of last month, 71.4% of the respondents (84) said they are currently considering moving their offices.

Most of the respondents answered that the areas that startups consider as new offices are Gangnam, Yeoksam, Seolleung, and Samsung Station (66.7%, multiple responses are possible). It seems that they still prefer the Gangnam area, which has a large number of investment companies, and has advantages in securing talent, collecting information, and forming a network.

50% of the respondents said they preferred urban areas such as Gwanghwamun, City Hall, Euljiro, and Jongno. This is because they believe that they can use a more pleasant space with the same rent compared to the Gangnam area. It is also analyzed that the recent increase in the number of companies moving to Gangbuk is also been considered. Yeouido area (YBD) was 13.3%, and Ttukseom and Seongsu stations in Seoul were 10%.

The most common reason for moving the office was “the burden of rent (50.0%).” It is analyzed that the investment market crunch was also reflected in the startup’s office operation plan. It was followed by executives and employees’ demand for relocation (30.0%), preemptive response (26.7%) due to the economic slowdown, and dissatisfaction with the current position (16.7%).

The most important thing for startups in the office was the traffic environment (90.5%) close to subway stations. Rent (71.4%) and the level of office building facilities (61.9%) were also important factors in office selection.

Ryu Kang-min, head of the research center, said, “Strict interest rate hikes and slowing investment markets are also affecting the trend of corporate office relocation,” and predicted, “More and more cases will focus on ‘cost-effectiveness’ rather than forcibly entering key areas to attract talent or creating a grand working environment.”

By fonuder

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