1. Estimate Your Budget
How to Calculate the Monthly Rent
Base rent + operating expenses (aka NNN) X the rental square footage. So if you are renting 4,000 sf, the base rent is $30, and the NNN are $10 your monthly payment will be ($30 + $10) X 4,000 = $160,000 / 12 = $13,333 per month
To keep from paying more than you can afford it’s a good idea to plan and stick to a budget. What you pay in rent will depend on the type of space you are renting, what all charges are included, and the market you are in.
As you start looking at spaces you will find out quickly what the going rate is for office space.
2. Determine How Much Office Space You Need
General rule of thumb is about 150 to 200 sf per person. Also check with the landlord on the parking ratio because sometimes that will determine how much office space you have to rent. You can also check out our office space calculator here.
3. Locate 3-4 Good Office Space Options
Don’t put all your eggs in one basket. It’s a good idea to have 3-4 options that you like if possible especially in a hot market. You can search online for office space listings yourself or use a commercial real estate broker that specializes in representing tenants in the search and negotiation of office spaces.
4. Pick the Office that is Best for Your Current and Future Business Needs
Go with your commercial real estate agent to look at the office buildings. When picking the best ones think about where your employees live, amenities nearby such as restaurants, shopping, and recreation. Being near public transportation and highways is a plus also.
5. Negotiate the Office Lease & Terms
Base rate and tenant improvements are a couple of things to negotiate. Also think about expansion and relocation options, termination options, exclusivity, sublease options, etc. Make sure to read the lease carefully and have an attorney review the lease as well.
Renting office space will be one of your top 3 expenses you incur when running a business so it’s important that you do it right. If you use the 5 steps listed above you will have a better chance at finding and renting the best office space for your business.
If you have any questions along the way feel free to give us a call at 512-861-0525 or contact us via our website