Things to Consider While Leasing Office Space

Are you thinking of starting a new business or expanding your current one? Renting office space may be the best idea when you have less financial backup or returns from your business. Finding a suitable place and finalizing it can take months. The search process has to be started twelve to eighteen months before you intend to move in. Commercial leases are more complicated than residential rental agreements. Hence, the process of leasing office space needs to be carefully done. There are chances of getting into the wrong lease agreement and it could be very risky as you may have to end up using your capital resources which could have been used for further growth in business. So let's look at the main factors that have to be considered while taking office space for lease.

1. Business Plans

The entrepreneur or the management of the company needs a clear vision so that they will be in a better position to forecast where the company would be in the next three to five years. Accordingly, they will be in a better position to figure out what kind of office space is needed for their business.

1. Location

Location is one of the most important factors to be considered for good returns from the business. Clients should be able to find the office easily. For example, if you keep a fashion boutique in a village, the number of customers approaching the boutique will be less compared to one in a city with a good view. Though a good location would cost more, it would provide other benefits like less transportation cost for transporting the inventory for a business, getting talented employees, etc. But, while opting for the office space in the best location, the cost of living needs to be considered.

1. Rent

A lease can be in either of the following two forms:

• Full service or gross lease is where a single rent amount is paid every month.

• Triple net or net lease is where you make two separate payments.

Full service or gross lease is usually quoted more than a triple net or net lease.

1. Security Deposit

Generally, a security deposit may be collected for a period of one to six months of rent, which can be paid in cash or letter of credit; as per the suggestions from the landlord.

1. Other expenses you may have to bear:

• Check whether you will also be responsible for common area maintenance.

• Check whether the building has separate utility meters or if you are just assessed a portion of the overall utility costs for the building. If so, find out how exactly it is tabulated.

• Furniture: Check out whether the office space is furnished or needs furnishing. If furnishing is needed, then, you have the option of going for used furniture or new ones from vendors who would supply at a low cost. Check out its costs before going for the deal.

• Parking: Check whether the building offers parking facility or do you have to sign a contract with a garage, nearby. If so, check for discounts.

• Telephone/Internet: Check for telephone and internet facilities available and know their rates.

• Tenant Improvements: Check for the cost of improvements and determine if it is really needed.

• Attorney Fees: A qualified attorney needs to be hired to review the lease deed before signing it.

• Commercial Liability Insurance: Before moving in, secure your business by taking an insurance policy.

1. Infrastructure/Amenities

• Does infrastructure suit your type of business?

The premises and the infrastructure should be apt for the business you are dealing with. Infrastructure and the amenities of the building have to be carefully evaluated to avoid embarrassment later on; that is when the clients, investors, or employees come in.

• Is the infrastructure in good condition? Is there any problem in the building like a problem with the lift, water, and sanitation facilities, etc?

• Does the architectural style of the building suit the type of business you are in?

• Does the office space have amenities needed for your office like, for example, conference rooms, after-hours security, pantry, etc.?

1. Having One's Own or Coworking Space

Determine whether you need office space for yourself or can you go for a coworking option, though having your own address is an advantage for your business.

1. Lease Period (Period)

Usually, landlords try to lease out the office space for a long period of time. But, if you are new into your business, you should try to lease for a shorter period of time such as three or five years. After that, as per your business needs and growth, you may either continue with the same office or go for a better or smaller one. You may even think of changing the location at that time. So if you lease for a longer period of time, then your business may get into losses by giving rent for space that you won’t need anymore.

1. Check the Policies for Move-in/Move-out

Check how much time you will have to wait before the space is move-in ready and also, about the responsibilities while moving out. Get informed about the penalties for breaking the lease, if needed, and check whether you will be able to afford it.

1. Rent vs. Budget

If the office location, infrastructure, and premises seemed to be ideal for your business, then check out whether the rent is affordable as per your budget.

1. Check Out Other Options

Before going for negotiation, check out the rent with similar buildings in the same location, with similar facilities. Doing this would also help you to have the option to negotiate with other options at the same time. Check carefully where your competitors are located in the same building or area, especially if you don’t prefer to be located very near to your competitor.

1. Negotiation

Negotiation is possible but make sure that you don’t negotiate for Class A building by comparing with what you can get in a Class B building at a different location. Negotiation can be done mainly for the following:

• Lease rate

• Lower security rate

• Free-rent

• More tenant improvement allowance, etc.

Basically, ask for what you want.

1. Get a Consultation from Expert Commercial Real Estate Agents.

Getting help from an expert commercial real estate broker, who can make the process easy as expert brokers or agents know the market well. Brokerage fees are paid by the landlord.

So why not get the help from the Commercial Real Estate brokers, Halsey Thrasher Harpole, who deals with Commercial Property Jonesboro AR! Contact and get to know them in detail for your needs. Call: (870) 972-9191. Visit https://halseythrasherharpole.com

Halsey is the real estate & property management realtors in Jonesboro, AR for Residential & Commercial rentals. Find apartments, house & rental homes for sale in Jonesboro, AR. http://halseythrasherharpole.com/