Golden rules for leasing your first office space

Golden rules for leasing your first office space

June 21, 2012 by Clare Moorhouse

To let sign outside office

Whether you're thinking of making the move from a home office to leased office space or you are establishing your business in a commercial environment, renting office space is a big decision – and one that requires careful thought and forward planning. 

The good news is finding your first office space is usually a sign that your start-up is beginning to expand and flourish, and means that you're ready to take the plunge and find a more productive environment from which to run your business. But there are both monetary and strategic issues to take into account, and these 10 golden rules will raise important issues for you to consider before leasing your first office space:

1 Make sure you're in a position to commit

Leasing office space means committing to a commercial office lease - and this is a legally binding agreement that will tie you in to a contract for a given period. You must ask yourself whether the move to leased office space will enhance your business and the services you offer, and that it will enable you to be a more profitable and productive business. An office lease is a big responsibility to take on and as a small business you need to make sure you are clear about the commitment and at the right stage to move on to a “real” office.

2 Ask yourself – can I afford it?

It goes without saying that a new office will tie you to regular monthly costs that you may not have had to consider until now. These will include rent, service charges, business rates, maintenance costs, insurance and the day-to-day running costs. Make sure you are fully aware of all the costs from the outset and that you don't overstretch yourself financially.

3 Don't try to do it yourself!

Finding the right office and then negotiating the right terms for your business is a time-consuming and complex process, so you should never attempt to take this on yourself. Use a commercial property agent in your area who knows the market inside out and can “hold your hand” throughout the process to ensure a profitable outcome for your business.

4 Make sure the lease is on your terms

Every office lease is different, yet they are usually drafted in favour of the landlord. Decide what office lease terms are best for you as a tenant; consider issues such as lease length, rental increases, options to renew, break clauses, etc. Clarifying these issues at an early stage will save lots of upheaval at the negotiation stage.

5 Do your homework

Do your homework on your shortlist of properties; tour the building several times; investigate who the landlord is and other properties they own, traffic patterns, who the previous tenant was (and why they left) and who the neighbouring tenants are.

6 Evaluate the building

Evaluate whether the geographical location, space and type of building is a good fit for your business. Your choice of office space says a lot about you as a business and you want to make sure it gives the right first impression.  Use our office space checklist as a guide to evaluate each office building.

7 Consider future growth

Make sure that any space you’re considering is big enough for both your current needs and your foreseeable growth. Be realistic and don’t under- or over-estimate your true needs.

8 Get professional legal advice

Hire a property solicitor who not only specialises in lease negotiations, but who also has dealt with start-ups before. A lease negotiation can cover hundreds of terms, often with confusing jargon, and you want someone who will represent your best interests and clarifies anything you don't understand.

9 Take advantage of the opportunity

Moving into leased office space provides you with a great opportunity to find the right office suppliers and install the right business communications systems that will enable you to operate efficiently and provide the best service to clients.

10 Don't rush into anything

Don't be rushed into making a decision if you're not fully comfortable. And if the lease negotiations don't quite come out as you planned – be prepared to walk away. There are always other properties that may better suit your needs.

  • Written by Clare Moorhouse of Help Moving Office – the online resource that guides businesses through the office relocation process.

 

Comments

Really good post on leasing office space i work for a company that offers serviced offices, because they have an in house manager they offer the person that has let a particular office space the ability to rent meeting rooms and grow into other areas of the property once the business needs develop in that particular direction. Office space needs to be as flexible as the people that are in them, without extended tie ins or extended waits to move in or out. Having been a startup myself its also so important to be able to strip back what you need to the barebones in the first few years until you can really establish your business. A good example of this was a client they had that started in one of the businesses virtual offices and have now just moved into one of the largest areas of the business 

Hi there, just found your site whilst looking up office furniture blogs in the UK - which i must say this is a fantastic post about office space, and I totally agree with all the points, in fact the "future growth" idea is something a lot of start up companies often forget about when trying to figure out how much they can afford.

 

Some great tips here - especially point two; all those extra bills can make the difference between an office being affordable or unaffordable.

Energy costs should be a particular area of concern - if a building isn't very energy-efficient your gas and electricity bills could be a lot higher than expected. If you find an office you love it could be worth checking if the terms of your lease would let you make a few eenrgy-saving improvements, as sometimes they can pay for themselves in terms of savings on your bill. This guide to energy-efficiency for businesses might be helpful?

Lauren

Add a comment

  • Web page addresses and e-mail addresses turn into links automatically.
  • Allowed HTML tags: <a> <em> <strong> <p>
  • Lines and paragraphs break automatically.
  • Links to specified hosts will have a rel="nofollow" added to them.

When you click 'Register' to create a new account, you accept our terms of service and privacy policy