Summary To Leasing An Office Location

It doesn't matter if you are moving or leasing office space for the first time. The process of assessing space requirements, creating a budget and touring the space, negotiating a rental agreement, and then moving can be overwhelming. In addition, it is difficult to lease space because there is not a standard lease, no building or landlord. The good news is, even though each tenant will have their own unique leasing experience, the overall path must be followed.

We Have Listed Eight Steps Involved In Leasing And Provided Links To Additional Articles. These Steps Are:

1. Get To Know The Leasing Process.

2. Decide If You Should Employ A Broker.

3. Evaluate Your Space Requirements.

4. Create A Budget.

5. Choose A Location And A Structure.

6. Talk To Landlords.

7. Create Space.

8. If Possible, Pack Up And Move.

Make The Leasing Journey A Part Of Your Everyday Life

Understanding the various steps and the time it takes to complete each one will help you set realistic expectations regarding the lead time needed to acquire office space. For example, it may take months to complete small blocks of space of less than 2,500 square feet. However, large blocks of more than 25,000 square feet can take years to secure and then build to your company's specifications.

Find Out If You Should Hire A Tenant Rep Broker

Although hiring a tenant representative broker is not required, contracting someone to represent your interests can be a good idea. Keep in mind two key points: 1) A landlord broker is legally bound to negotiate for the landlord. If you work directly with them, it is important, to be honest about which interests they prioritize. 2) Commissions to both tenant reps and landlord reps are usually paid by landlords. Technically, you are not "hiring" a broker since you aren't responsible for their compensation.

Evaluate Your Space Needs

It is important to determine how much space you need and how your office will be set up before you start the leasing process. A back-of-the-napkin calculation can help generate a reasonable estimate. This is done by multiplying the number of employees that you need to accommodate with the average square footage of each office worker in the U.S. This figure is currently at 180 square feet, according to CoStar.

If you have 40 employees, each of whom will need their own desks or offices, along with a few conference rooms and a pantry kitchen, you'll likely need 7,200 square footage. The number of conference rooms you require and the kitchen you use will affect the amount of space you need. You may also need additional offices or cubicles. If you plan to create a reception area, the spacing between columns and the window lines of buildings you are looking at, these numbers will fluctuate. These details will help you to search for space blocks that are between 6,000 and 9,000 square feet.

Create A Budget

It is important to know how much rent you can afford. A back-of-the-napkin calculation may help generate a reasonable estimate. Continue the above example. If you rent 6,000 square feet at $30 per square foot, your annual rent would be $180,000.

The $30/square-foot rent price is subject to change depending on whether the property is offered as a full-service, triple-net, or split-net. The former indicates that rent includes all utilities, taxes, and management fees. The latter means that rent will include the $30 rent. These operating expenses will vary depending on the market and building. They can range from 2.5% to 25% of the base rent.

A renter must also allocate funds for legal fees, the first month's rent, and construction costs.

Choose A Location And A Building

This aspect of the process is crucial to the success of your search for office space. These include understanding the needs and preferences of key stakeholders within your company, determining the proximity to clients, and assessing whether employees commute regularly. Your decision about where to locate can also be affected by the labor costs and tax structure in certain areas.

There are many other factors that you should consider once you have narrowed your focus to a specific building. For example, are the floorplates able to accommodate the type of build-out your company requires? This is just one of the many criteria that you need to consider when evaluating locations, submarkets, and buildings.

Talk To Landlords

You or your broker will need to negotiate with multiple landlords to get the best overall lease package. Landlords assume that you are looking at multiple properties. Once you have a list of possible locations, you can contact their respective landlords via a request for proposals (RFP). You can make the best offer for your company by being open to considering a variety of options.

Concessions like tenant improvement allowances, rents, and multiple months of free rent, reduced costs, renewal and expansion options, as well as the right to sublet your space are all conditions that will provide maximum value for your company.

Create Space

There are many options for office space. You can choose from "shell" spaces with exposed columns, wires, pipes, and unfinished walls or ceilings to fully furnished, ready-to-occupy "turnkey" spaces. Some spaces need to be partially or fully demolished and reconstructed. It doesn't matter how extensive the construction is required for the space you are interested in; it's important to know the estimated cost of building it.

Many landlords offer "tenant improvements" packages that will cover the majority of all of your costs for building out your space. It is important to compare offers from landlords. A $100 per-square-foot tenant improvement allowance might not be as generous in certain buildings. Therefore, you should generate construction cost estimates before signing a lease.

Pack Up And Move

An office move includes:

• Notifying employees.

• Determining which furniture to keep.

• Purging files.

• Ensuring the lights are on in a new location.

This is the final step after months of planning, touring, calculating cost, negotiation, and building. Although the steps involved with moving to seem simple, it's important to plan and establish expectations for employees. You will be ready for every phase of the move, from hiring movers to setting up computers and vetting them for their safety.