BBB Warning

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BBB Warning: Dallas-based commercial real estate company leaves small businesses in distress over auto-renewed contracts

BBB of North Central Texas is warning business owners to be aware of Regus Management Network’s pattern of complaints regarding their business practices. Regus Management Network currently has an “F” rating with BBB.

Regus Management Network is a worldwide company offering office space, coworking, virtual offices, and meeting rooms for lease. Business owners have complained to BBB, alleging the company’s failure to terminate contracts, refund security deposits, or disclose their auto-renewal policies. These issues are a continuation of complaint patterns monitored by BBB since 2016.

Some small business owners may be considering virtual office spaces to help save on operational costs or provide staff a “remote” workspace that is more professional than a home office. While these short-term and temporary office spaces can be a good fit for some businesses, business owners need to research providers carefully to ensure a decision intended to save money doesn’t cost them in the long run.

“These concerns are particularly alarming, as business owners are faced with multiple challenges associated with the impact of the coronavirus pandemic. In 2020, Regus saw an 82% increase in complaints filed with BBB, placing it in the top 30 businesses with the highest volume of ‘unanswered’ complaints across the BBB system. The business was unresponsive to BBB’s request to address the noted pattern of complaints, as well as advertising concerns,” said Hannah Long, VP Director of Dispute Resolution, BBB Serving North Central Texas.

A Georgia business owner complained, “Regus auto-renewed my contract that had three months to go. Now they tell me that I cannot cancel the contract when my original one hasn’t expired. When I discovered the auto-renewal, I attempted to cancel the contract because I did not want to auto-renew.”

One Chicago small business owner reported, “I signed a contract and promotion was pay three months and four months free. Regus keeps invoicing me. Impossible to contact Customer Service. I signed a contract with Regus in August 2020 for four months. I paid for my three months, and December was supposed to be free. Regus continues to invoice me, charging me for the fourth month and then extra fees of $62 and $95. They never gave me a copy of my contract.”

Another complainant from Washington DC explained, “As a small business, we reached out to Regus for a virtual office space. Before payment, their sales representative told us that we would receive the requested services we needed for our business. Upon payment, they denied us said services and were told we needed to upgrade (i.e., pay more money). They led us to believe we would receive the services we needed, and once they managed to lock us in a one year contract, they said we owed them more money to get what we needed.”

Business tips when signing contracts:

Get answers. Before signing, ask what happens if you move or go out of business. Will the membership renew automatically at the end of the term? What is the cancellation policy, and under what circumstances?

Understand the terms. Read the contract carefully before signing, and make sure that all verbal promises made by the salesperson are in writing. Don’t just take a salesperson’s word for it.

Check BBB.org. Before signing any contract or lease agreement, make sure you check BBB.org. Read what previous customers have to say, and see how the businesses respond to complaints.

For more business advice, visit BBB.org.