Guides and Tips
10 Tips on Negotiating Your First Office Space
Thinking about a new office? Follow our guide to what can be considered when creating a lease.
Before you begin to negotiate a Lease its important to be certain your Company or Practice will be happy with your new office or facility. We recommend that you create a Leases decision checklist with the most important aspects of your facility to help you compare different potential locations. You are welcome to use our form (form) or create one to help you determine your best alternative.
What is the term of the Lease? This is important because the longer the term most often translates into a better lease rate so if you think your company will stay relatively the same size go for a longer term. However, if you predict expanding, ask the Lessor how they will be able to accommodate the potential growth.
What are the Common Area Maintenance Charges (CAM) and what is included in them? Ask if there is a cap on the increase in CAM from year to year.
Who pays for utilities and historically what have they been?
What specific improvements will be performed by the Lessor to prepare the Suite? When will these be performed? What improvements will have to be installed by you as the Lessee?
When does the Lease commence? If you must install improvements as Lessee can they be done before rent is commenced? Most Lessors are willing to wait until you are in and operating before, they start charging rent and, in some instances, Lessors will abate the rent for a month of even longer as an incentive to Lease.
Ask about signage. Find out if there are opportunities to identify your Company or Practice at the entrance to the complex. In addition, make sure you understand the signage system of identifying Lessee’s and who pays for it upfront. Make sure you are confident your customers can find you.
What happens when the Lease expires? Negotiate the cost of any options to renew the Lease now instead of waiting for the Lease to expire including not only rent adjustments but opportunities for refurbishment such as floor cleaning or repainting.
What are the Building hours and how do you access the building during off hours? This is important for those who may want to work late or on weekends because during off hours many buildings turn off their HVAC and lighting systems.
Who pay Brokerage fees? In most instances the Lessor will pay any Real Estate agent costs including the agents who represent you. However, agent or broker fees should be discussed ahead of time until all parties know and agree.
How is the rent paid? More and more Lessors are requiring the rent be automatically paid by bank draft directly into the Lessors bank. While this practice can be an attractive convenience just make sure you understand and can agree with the policy of the Lessor upfront.
It’s important to perform a complete assessment on your potential Lessor’s background. Will they be a responsive facilities provider? Is management local or on site? What is their reputation? Do you know any of the other residents in the building? if not, is the Lessor willing to introduce you to some of them or provide references? As for us, we believe the more you look the better you will like us. That’s because we see ourselves as your facilities provider partner with the simple but genuine goal of aiding your success by making sure your office works for your Company.