Whether you are looking for a bigger space, reduce real estate costs or just move elsewhere to boost team productivity with a new workplace, making a move to a new business location is crucial not only to create a new environment and positive outlook but also influence the bottom line and business objectives.
It is therefore crucial to look just beyond the aesthetics and prime location, so we hope office administrators have not failed to cover the following steps in their office hunting exercise.
1. How much floor space do you need?
Depending on your current or projected manpower size, office area can be estimated depending on the layout of your workplace, and typical estimates look at about 1,000 square feet for every four to six office workers. Of course this may vary on how you layout your office — are employees sitting on individual cubicles, share a spacious table, or get the privilege of private office, but you get at least a benchmark for the amount of space you need.
2. Will the new office be accessible or further away from employee homes?
Moving to a new office can turn for better or worse in terms of commuting from home to office. Although it’s cheaper to move to places that are not so convenient to public transport, it’s also going against the productivity as employees who live further away that the old office are more likely to be late or spend more for transportation expenses.
As a result, going for a cheaper office with complete facilities and excellent views but located remote from worker homes can be a key to higher turnover, lower productivity, more hazards and unhealthy lifestyle for your most important company assets.
3. Is the property market gearing towards higher price range?
Make calculated risks when entering the market for office space. Although plenty of projects involving office space is in the pipeline of many large developers, rates can still be expensive and continue to rise. In this case, check whether it is time to move out or reconsider a new deal with the existing landlord. After all, moving to an office — cheaper or more expensive — still has plenty of overhead costs.
4. Are you in prime position to negotiate?
The rates displayed for office properties at your new office vicinity are subject to how the market reacts. Depending on demand, these rates can easily go up or down. Is it now a buyer’s or a seller’s market? You’ll be able to tell depending on how a landlord through an agent reacts to your bargain offer.
Try offering a price that’s 15% – 20% below what’s on offer and you’ll see how firm or how open the landlord reacts. Rate may be small but landlords don’t like office spaces sitting idle while they pay for maintenance, taxes and so on.
5. Will you be open to subleasing an office space?
If you find a space that’s ideal for your business — accessible to clients and employees, close to transport links and suits your budget per capita, but too large to accommodate your existing team, one consideration is to sublease it to another company, turn it into a co-working space with facilities for meetings and training facilities for rent and desks for one-man companies to use.
Shorter subleases such as monthly contracts for flexibility and longer ones for cheaper overall costs. Taking this route instead of occupying the entire floor with plenty of tables and chairs makes good use of available resources. Besides, a big office with a small workforce and lots of empty spaces does make it look a bit uninspiring and won’t portray a positive environment for office dwellers.
6. What’s the outlook for your business?
Moving an office from one location to another is often beyond just the tenancy agreement expires. It can also be the business is growing and space becomes a premium it cannot give up. Otherwise, if the company just let go a significant portion of its workforce, there’s no need to stay in the same location if cheaper, more practical options are available.
Gauge the movement in the industry. Check whether the company is looking to expand the team and continue to use more space in the future or change in business plan — perhaps looking to consolidate offerings and get rid of non-performing business units.
7. Is the new location more attractive to customers?
If your business requires personal interaction such as laundry shop, water refilling station, restaurant, hair salon or travel agency, it therefore helps to move to a new location that has higher foot traffic. But if not, such as architectural company, web design agency or law practice, where agencies typically visit customers, consideration for location is geared towards employees and management.
8. Is the new office space compliant with government regulations?
The new office location must be compliant with safety standards for both customers and employees. For example, are fire extinguishers working and fire exits properly marked? Elevators must also pass regular maintenance checks and air quality above the prescribed levels. Check the building for earthquake standards for buildings within the city limits.
To be sure you’re moving to a new place that abides by safety standards, get a copy of such documentation from building administrators.
9. Are utilities covered in the rent and what else should you expect to pay?
Utilities are often paid separately by the company and not inclusive of the monthly lease rate. However, never assume and be certain this is (or this is not) the case. Besides water, electricity or phone bills, check with the agent or building management what else you need to pay.
Some establishments require payment for sanitation — someone will clean up the office after every business day — or parking space or security system such as those surveillance cameras and security staff. This helps you to be prepared in allocating budget for such expenses and not surprised by these bills at end of every month.
10. Do you understand the terms of rental agreement?
While this rental agreement document can be full of legalese that’s not commonly used in everyday life, be sure to understand each item and consult a relevant professional to get this sorted out. Since the agreement is between your company and the landlord, a real estate broker can help clarify some of the confusing clauses within the document.
- How long will the lease be? What are the terms and procedure of breaking off before the lease expires?
- Where is the defined vicinity of the leased office space? Which part is for the company to maintain, renovate or upkeep?
- What’s your right to modify the leased office space and what are the limits?
- Will you be charged with additional fees such as property taxes, cleaning, security, etc?
Other good questions to ask the agent or landlord:
- Is the office serviced or unserviced? Do you need to pay for cleaners or pantry dishwashers or subscribe to the building’s provider.
- What is the insurance coverage of your lease including life and property?
- Is the management able to provide an in-house plumber, computer network administrator, electrician or you need to hire outsider?
- Will you be able to access the office 24/7 or there are restrictions?
- What transportation links are available within a reasonable walking distance from the office?
- Is it close to supermarkets, restaurants or fast food shops for employees to get lunch?
- Do you have control over the room temperature or is it centralized?
- Are there enough power sockets to support more devices or appliances you may install in the future?
- Is the water in the tap potable or you need to get water delivery?
- Are there possible noise sources that may affect working in the office (ongoing construction, close to highways, near a fire or police station, etc)
Good luck on your office space hunting!