Leasing office space can be a complex undertaking for any business and is always likely to be problematic for those doing it for the first time.
As a business owner, you’re most likely not a commercial property expert. That’s why it’s important to surround yourself with a team of experts which should include:
• An accountant – to help you establish what your business can afford and how much you need to budget for any initial fit-out costs
• A solicitor – to help you through the process of agreeing a lease and dealing directly with the Landlord’s solicitor
• An office agent – to help you identify suitable properties, negotiate the terms for you and generally let you get on with running your business.
Once you have established your team, you need to have to given thorough consideration to the following before starting your office search:
• LOCATION – Think about where do your staff live and will you be able to recruit new staff easily in a particular location? Think about road access and proximity to local amenities. City centre locations generally offer the best access to public transport and amenities but aren’t as good for parking as business parks.
• SELF CONTAINED or MULTI LET BUILDING? – Do you want to be in your own building which will usually mean being split over several floors? Or would you prefer to have a single floor in a multi-let building? The latter will mean you share the building with other companies and pay a service charge for the shared services. If you have your own building you have more control but it is likely that your staff will not all be on the same floor which does not suit every business.
• IMAGE – Do your clients visit your office or is it purely an administrative office? If it’s client-facing then you will want an office that projects the right message for your business. Even if it’s not client-facing, you should consider what image you want to give to your staff and prospective recruits in order to help you retain and attract the right staff.
• LAYOUT – Most offices offer a clear open plan layout and it’s the new tenant’s responsibility to install internal partitions and potentially a new kitchen and reception. Whilst you may find some offices with some internal partitions already installed, it’s always going to be challenging to find to somewhere that will suit your business perfectly. You should consider how you want to configure your new offices before starting your search.
A commercial agent can help guide you on these points and help advise you on the options available, focusing on what’s most important to your business.
Once you have identified some suitable options is time to start appraising the costs of occupation:
1. RENT – the most significant cost and normally quoted on a ‘per sq.ft’ annual basis. Rent is sometimes negotiable and it is sometimes possible to secure a reduced rental period at the start of a lease depending on the lease length.
2. SERVICE CHARGE – generally applicable in multi-let buildings and business parks and calculated on a ‘per sq. ft.’ annual basis.
3. BUSINESS RATES – normally charged by the local authority and can sometimes be appealed.
There are a range of other issues that need to be considered including repairing liabilities, rent reviews, break clauses and your rights to sublet.
A commercial agent can negotiate these points on your behalf with the potential for significant financial savings. The time it takes to navigate your way through this maze should not be underestimated so all the more reason to appoint an agent.