Fifty-three percent of workers say they can't find the kind of workspace they need. This is an alarming statistic, considering the massive impact a work environment has on employee engagement and productivity.
SummaryIdentify leverageConsider office lease length more than ratesDo comparison shoppingConsider subleasesConsider working with a leasing brokerNegotiating exit protectionNegotiating a good office lease shouldn't be a problemThe fact is, your office space is a deciding factor. Finding the right office space in the perfect location not only boosts staff morale, but also increases your visibility and foot traffic.
Now, if you've already seen a suitable property, the next critical step is to negotiate your office lease. But setting up a favorable office space lease is easier said than done. Oftentimes, contractors end up with poor leases that are financially draining them, even if they meet their sales goals.
In this comprehensive guide, we give you seven foolproof tips for renting office space like a pro.
Whether you're looking for office space in the tenant market or the landlord market, you can always find something you can use as leverage.
One way to create leverage is to make sure time is on your side. This means you should start researching commercial leasing options long before you need to move into the new office space. If you wait until the last minute to start negotiations, lack of time could decide the terms of the lease, often to your detriment.
Avoid revealing your feelings about the office space you are considering, especially to the landlord or rental broker. If it becomes clear to everyone that you simply must have the office space, you have given the owner or listing broker some leverage.
Make sure you have solid backup options. One of the most powerful aspects of a successful negotiation is being ready to go.
Often, entrepreneurs looking for office space are caught up in rental rates. Of course, the office rental rate is an important factor, but the length of the lease can have a greater impact on the company's finances.
Don't just focus on negotiating a handful of percentage points on the lease rate. Instead, think about what your business really needs for the future. If you select the wrong term, you could end up spending more money on rent for office space that doesn't help you achieve your ultimate business goals.
Research is the most powerful weapon in your arsenal when negotiating a great office lease. Take the time to discover what is on offer. Determine the average rental rates for office space in the area you are interested in to avoid being overcharged.
Be sure to compare apples to apples. Learn the difference between leasable area and usable area.
Generally, leasable square footage is less than usable square footage because usable square footage does not include common areas such as elevators, lobbies, bathrooms, and public hallways. The idea is to ensure that you use the same method of measuring space when comparing rental rates in various office spaces.
Having enough information about current rental rates gives you an advantage when negotiating your office space lease.
You can also get a great offer for office space from a company that has more office space than it needs. Generally, sublets are easier to obtain. Sublets also tend to be considerably less expensive than master leases.
Another benefit of going with a sublet is that the space is usually ready to go and usually comes with built-in upgrades. Plus, you can get a shorter lease term, which is great if you're planning to move to another office space soon. By subletting, you will also be able to have access to reception areas, conference rooms and common areas.
Before subletting, be sure to carefully review the head lease, as you will be subject to its terms.
One of the smartest things you can do when renting an office is to have a tenant broker on your side. Landlords can be difficult to deal with when negotiating a lease. Many will make unreasonable demands or demands.
A competent tenant broker makes every effort to best represent your interests during rental negotiations. They provide all the information you need on today's market and help you find the perfect office space for your business.
Top brokers, such as austinofficespace.com, will also arrange tours of available spaces, so it will be easier for you to choose what appeals to you the most. They can write offer letters and expertly negotiate with landlords on your behalf. If you need other experts to prepare the space for your move-in, such as architects, general contractors and equipment vendors, your broker can help you get in touch with them.
Even with the best-laid plans, things may not go as planned in your business. That's why you should think as far as possible before signing the rental agreement.
If you believe you have good visibility for the next three years instead of five, it is prudent to negotiate termination clauses. The idea is to make sure that if things don't work out as planned, you can get out of the lease with minimal damage.
For many entrepreneurs, negotiating an office lease can seem like a daunting ordeal. The truth, however, is that you can simplify the process and end up with a great lease on your dream office space. Finding leverage, choosing the right lease term, doing thorough comparisons, and working with a professional are just some of the ways to do this.
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