Establishing or relocating an office space is a major endeavor. It may be your biggest foray into commercial real estate. When a business needs to move, there usually is a significant reason such as a substantial change in size or dissatisfaction with the current landlord.
To start the process, you’ll first want to ask yourself these 3 questions:
- What is your budget for renting office space?
- When does your business want to move?
- How will you mitigate any disruption to the business operations?
Now that you’ve considered the needs of your business, you can start to put together a game plan for your new office. Utilizing nearly 50 years of commercial real estate experience, Uniland has identified the Six Key Factors to determining your new office space needs:
Office Size and Layout
One way to determine your office space needs is to use the guideline of 100-200 square-feet per employee and leave room for growth. You can also try an online tool such as this Office Space Calculator.
For layout, an architect designs an office to accommodate a company’s staff and other office space needs in the most efficient manner possible. They perform a procedure called “programming” whereby information is collected on a business’ needs and how it functions. This information yields a basis for the design layout of a space.
Some commercial real estate landlords offer this “programming” service to clients free of charge.
Office Location
As the adage goes, “location is everything.”
Is your operation better suited for an urban or suburban environment? Is high-visibility a priority or an environment with more landscaping and green space? Do you desire on-site amenities? Will a site within a short walk or drive be an asset to them? Do your employees use mass transit? All of these answers will help to narrow your search areas.
Amenities
Business owners know that a successful business starts and ends with happy employees. For commercial tenants, amenities enhance a work environment, and small perks can go a long way in recruiting and keeping good employees. To attract and retain the finest professionals, some office amenities that can help drive employee efficiency and convenience include
- Free on-site parking,
- Under-building parking and storage,
- On-site café or market,
- Proximity to retail plazas and grocery stores,
- Outdoor seating and dining,
- Proximity to day care,
- On-site fitness facility, and
- Proximity to mass transportation.
Price
Start with the proposed lease rate and then assess overall value. For example, price per square foot ranges from $22-$27 for Class A office space in Amherst, New York, a popular Buffalo suburb.
To determine value, ask if necessities such as utilities, janitorial services and repairs are included in the rate. If not, add that expense to your monthly lease payments.
A real estate firm with in-house construction services will estimate the cost of customizing and constructing the office space for you, known as tenant improvements (TI). Larger landlords often provide additional services such as paying for the TI upfront, and amortizing the cost into the lease rate which reduces your upfront capital commitment.
Lease Term
Eager to avoid tenant turnover, many landlords offer incentives based on lease duration. The longer the lease term, the lower the lease rate. Additionally, a landlord typically provides a TI allowance—capital to help the client make changes to the office space such as moving walls, adding offices or conference rooms, etc.—if the company signs a longer lease term of 5, 10 or 15 years. Also recognize that a portion of your rent transaction pays for the maintenance of the “common areas” in the building (main lobby, bathrooms, elevators, etc.) if they are shared by other tenants.
Property Management
This service is often undervalued during the search process.
As a prospective tenant, you should spend as much time finding a commercial real estate firm that provides quality maintenance and professional management as you do finding the right location. Your office space and the building in which it is located is not only a major investment, it is a reflection of your business to your clients. When a problem arises, you want a quick response.
Locating at a building owned by an experienced landlord that has quality property management services often pays for itself many times over in reduced employee headaches and improved client experience and retention.
Choose to invest your office space with a partner that will address your business opportunities with tailored commercial real estate solutions.
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