28 Tips When Renting Your First Office Space

renting-your-first-office-spaceRenting your first office space is exciting as it means you have so far proven yourself in business. It’s also one of the biggest expenses you will have so choosing just any old office without the proper due diligence would be a huge mistake. You need to make sure that your office will be able to accommodate your current and future needs allowing you to grow as a company. Below are a few tips to keep in mind as you embark on renting your first office space.

  1. Decide If You Even Need One – Before you go rent your own office space make sure you really need one. A lot of startups work from home or use co-working facilities and do just fine. You might be able to save some money by going this route initially. 
  2. Start Your Office Space Search Early – One of the biggest mistakes people make is waiting until the last minute to lease space. In a busy marketing finding the perfect space takes time. Don’t settle. Please give yourself at least 4-6 months to search, select, negotiate, and rent office space.
  3. Negotiate More Than One Option – Don’t put all your eggs in one basket. You don’t want to spend ALL your time negotiating one deal only to find out the landlord leased the space to someone else willing to rent it for more money. Ideally you want to be negotiating at least 2-3 options at the same time.
  4. Pick a Location Near Your Employees – You don’t want them having to drive 1 hour each way do you.  When renting your first office space choose a location that is convenient for the majority to get to or close to where the pool of talent is. 
  5. Keep Your Clients in Mind When Picking a Location – Make it easy for clients to find you. Try to pick one that is near or accessible to major highways or public transportation.
  6. Keep Amenities in Mind – When renting your first office space pick one that is close to restaurants, shopping, physician offices, and other conveniences. The closer the amenities the more convenient it will be for your employees to get their errands done during their breaks. You don’t want them having to take half the day off.
  7. Stick To a Budget – This is your first office space so don’t break the bank. Have a budget in mind before actually starting your search and try to stick to it.
  8. Expect to Have Additional Expenses – There are more expenses involved when renting office space than just rent. Make sure you ask each landlord what is included and not included in the asking rent. Who pays for utilities, phone, data cabling, and internet services?
  9. Know What the Lease Says – Don’t just take the landlords word for it. Actually have a commercial real estate attorney review the lease. Make sure you also understand the provisions and what will be expected of you and the landlord.
  10. Know Who is Responsible For Repairs & Maintenance – Make sure you know what repairs the landlord is responsible for and when communicated how quickly they are to make the repairs. If you are responsible for repairs then you want to estimate the cost and include that in your budget.
  11. Get Help From a Commercial Real Estate Expert – If you are renting office space for the first time the process can be overwhelming. If you use a commercial real estate agent like Austin Tenant Advisors they can make the process much easier. They will have vast market knowledge, have quicker access to all the current and future available spaces, and can help you  negotiate the best deal.
  12. Building Security – If you need security ask if the building has a security guard or secured entrance as well as after hours security.
  13. Rent Space that You Need – Don’t lease too much space. Consider having a space planner help you calculate your space needs.
  14. Lease Space With Room to Grow – If you sign a 3 yr lease you don’t want to grow out of it in year 1. Make sure you find a space that gives you the ability to expand if needed.
  15. Determine Your Office Layout – Do you want all hard wall offices, open office, or a combination of open space and hard-walled offices?
  16. Know How The Space Will Be Delivered – Make sure you completely understand how the space will look before you move in. Do you want new carpet and paint? New walls or demo? Make sure to sit down with the landlord and get in writing how the space will be delivered.
  17. Make Sure the Building Has Good Parking – One thing that is often overlooked when renting your first office space is parking. Make sure there are plenty of parking spaces so your employees don’t waste time looking for a space. Also make sure the parking is secured.
  18. rent your first office spaceConsider Bike Storage – Do you have employees that ride their bikes? Make sure the building has a secure bike rack or secure storage area so they can store them.
  19. Consider How You Want the Office to Appear to Others – The way your office looks sends a message to others about your brand and culture. If you pick a building that is not well maintained then this might convey to your clients that you are a struggling business. However if you lease the most expensive Class A office then that might tell them you are charging too much for their services.
  20. Make Sure You Have Meeting Rooms – Open offices are great for collaboration and team work however you need to have at least 1-2 meeting rooms for private meetings. 
  21. Have a Break Room or Wet Bar – So your employees don’t have to leave the office every time they want a cup of coffee make sure your new office has a break area…..and offer them free coffee, drinks, and snacks. You will not only save them money, you will also have more productive employees as they won’t have to leave the office all the time.
  22. Know If & What You Are Able to Customize – Make sure get in writing from the landlord what changes you are allowed to make in the office. Some may not want you to knock down walls without consent. The last thing you want to happen is that you spend thousands of dollars making improvements without landlord consent to only find out later that you will be required to put the space back in the same condition as when you first rented it. Get approval BEFORE making any changes!
  23. Lease Term – When renting your first office space try to get a shorter lease term if possible. If your business grows, gets purchased, or goes out of business you don’t want to get stuck with a long term lease. However your ability to get a shorter term depends on the market you are in. For example if you are in a hot office market like Austin, Tx then you will have a harder time getting landlords to agree to a shorter rental term. Most landlords in a hot market want a minimum of 3-5 year leases. That being said it never hurts to ask for a shorter term.
  24. Be Confident in Your Business – Where do you see yourself in 3-5 years? If you don’t have confidence in your business would you expect the landlord to? You need to have a plan and let the landlord know your planning for success and not failure. Otherwise the landlord will be hesitant to rent you your first office space.
  25. Have An Exit Clause – While you need to portray confidence in your business things happen. Which is why you need to have an exit plan. If you need to break your lease you need to know what your options are and what fees or penalties you might be required to pay.
  26. Negotiate – Everything is always negotiable when renting office space.  However keep in mind that some markets are stronger than others (e.g have more demand for space and lower vacancy rates) than others which means rates, terms, and concessions will be different.  Just because you get a $15 dollar class A office rate in Phoenix does not mean you will get that same deal in Austin. When negotiating don’t only focus on lease rate. There are other things you could negotiate such as a lower security deposit, free rent, more tenant improvement allowance, etc. Always ask for what you want!
  27. Know your future – you always want to anticipate growth when leasing office space. Choose buildings that can accommodate future growth if needed. Moving every six months is not ideal so do your best to find a building that is flexible.
  28. Know your landlord – Before signing lease find out who the landlord is. How long have they owned the building? Is this a long term hold for them or a short term? How responsive are they with repairs, maintenance, etc.? Who is the property manager? Ask a few existing tenants about their experiences in working with the building property manager and owner.

If you have any questions about renting your first office space don’t hesitate to give us a call at 512-861-0525. Our website also has a ton of free information & tips about renting office space.

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