Looking at the Building’s Features
Many companies or office leases often take into consideration the economic value of a workspace before renting it. However, occupancy costs do not just include the rent rate.
When considering a property as a potential office space, office tenants should also consider the building’s features and what’s included in the Landlord’s office space service as it can influence the rent rate. It is most common to hear about tenants and brokers reporting poor performance and drawbacks because they did not take into account the building’s full potential and features.
There are other factors which are often overlooked but must be considered when checking a property:
Although some properties offer low lease rates, it may not be useful and practical once you compute the total cost of occupancy and the space’s efficiency. In one specific scenario, a person can offer you a 10,000 square foot space with a 20% loading factor (a percentage is allotted for non-business related space) while a landlord can offer the same price for a 12% load. Although the first offer is cheaper, the landlord’s building may be better because the tenant can put more desks in the space without being restricted by the load factor.
Always remember to compute the occupancy cost projections based on the absolute and present values and analyze them per usable square feet. This will allow tenants to see the differences in common area factors and efficiency.
This is the overall equivalent of the expenses needed by tenants such as taxes, janitorial, maintenance and personal expenses while using the office space. Get the advice of a broker who can ensure that the building selected would give cheaper operation costs. Tenants should also consider using building efficiency items such as energy-saving appliances and an HVAC system.
Not all buildings can provide and support specific technologies or industries, which is very important because it can affect production capacity. The technology industries – for instance, would require higher power and cooling capacity for their office space but it may not be allowed or applicable with the building. Other businesses – like those requiring a mobile workforce, would need a very big parking space which would not require constant parking contracts.
The IT sector and telecommunication providers would also need the building to support redundant fiber loops. Others would even require the building to provide them a space for back-up generators for their 24/7 operation
The building must have a dedicated and friendly staff for tenants to discuss building-related inquiries and needs. Some tenants may even speak with other tenants to get their reviews regarding the building as it would allow them to determine the management’s quality and the services offered for tenants.
It is important to check whether the building’s management can deliver the quality needed by the tenant and how close do they work with the existing tenants.
Usually, tenants complain about the following
- Heating, ventilation and air cooling system (HVAC)
- Janitor or maintenance staff
Some tenants may find their building option wrong especially once they see that the existing tenants may pose problems for the company. Others may find it likely that their competitors are in the same building.
Having an attractive tenant mix can show potential tenants that the building would not just support higher economics but also show that it is the best place to be. The building and its tenants also is key in developing a brand and creating the labor base. Usually the property gives out the first impressions over a building.
Nowadays, sustainability is a critical factor that businesses must meet because of the growing standards needed to make buildings greener and environment-friendly. It is also a must have nowadays to support a company brand.
The tenant’s broker must be able to determine green building terminologies and assist in checking whether or not a building passes its green building standard. In the US, for example, brokers must be familiar with the Leadership in Energy and Environment Design Green Building Rating System as passed by the US Green Building Council.
Costs and other factors
Finally, some companies also take into consideration other factors like the coolness or benefit factor of a building. However, this should not be the case because not all benefits can be received from a specific building.
One must need to be cautious with regard to renewing lease and check if the financial capacity of the company can handle additional lease costs in the market place. Of course, tenants can do both to ensure that the building is fit for your needs.