When searching for the perfect office space for your company, people often tell you the many things you should do, but we’re going to tell you 6 things you should avoid at all costs. Listen to today’s podcast for all the deets. So, what’s first?
- Going it alone ~
- You wouldn’t go into court alone – without an attorney.
- If you get sick or test positive for COVID, who is the first person you call? Your doc, right?
- When you get an audit notice from the IRS, I’m sure you’ll call your CPA.
- So, if you plan to lease office space and commit your company to an obligation of hundreds of thousands if not millions of dollars, please hire an expert at finding space and negotiating leases. I’m no attorney, doctor or CPA, but I do know office leases after 37 years in the business.
- Trust me folks, Bob knows since 20 of those years were working for landlords!
- Ignoring the neighborhood ~
- Sure, the building itself needs to be pleasing to you, your employees and customers, but failing to pay attention to the surrounding area is a big mistake. Is the area safe? Will my employees want to work here? Is it walkable? What is the chance of future developments of buildings and streets?
- I once toured a client for desired space and he had selected two sites-I recommended that he bring the department heads from his company and most of them said “No way”! They felt it wasn’t safe to walk to the parking garage.
- OK, and the MOST important question of all…..is there a Starbucks nearby, or better yet, in the building??
- Betting on the future ~
- It’s definitely important to consider the growth of your company, however, don’t lease more space than you can reasonably predict your company will need.
- Occupancy costs are typically the 2nd highest cost of companies so don’t obligate yourself to a bunch of extra overhead hoping for the future growth.
- Heavens, no! No one wants that but if anything 2020 has taught us that nothing is written in stone.
- Not using an attorney ~
- We always advise REATA’s clients to have their attorneys review their leases.
- Don’t ever sign a contract without reading it. But it’s more important that your attorney read it.
- Leases are long and frankly, boring, but they are written by the landlord, so they aren’t exactly balanced.
- The company’s attorney, owner and tenant rep should all review the lease in depth. Each one will read it from a different angle and all together, they make a great team.
- Assuming that your employees want to come to the office ~
- This wasn’t on the list 12 months ago. But it’s a legit issue now.
- Studies have shown that employees would give up 10% of their income to work from home.
- If competitors offer that option at least one or two days a week, your employees may go work there instead.
- You could also reduce your 2nd highest expense.
- A hybrid of office and WFH seems likely for a lot of companies. I’ve heard estimates that 35-40% of people can reasonably WFH.
- And the final one – overlooking subleases ~
- Exactly. We discussed this at length in episode #8 last May so we won’t go into detail right now, but there are some screaming good deals out there with plenty of time left on them. Furniture included in many cases. It would be a mistake to not consider subleases.
Bob Gibbons is a Real Estate Advisor & Tenant Advocate (also known as a tenant rep) with REATA Commercial Realty, Inc. which is a tenant advisory firm based in Plano, Texas. Bob serves companies in Plano, Frisco, McKinney, Allen, Richardson, Addison, Dallas and the surrounding areas and specializes in companies which lease or buy office and warehouse properties.