6 Tips For Leasing Office Space: Part 2
Office space is generally the second biggest business expense behind employee salaries.
Salary expenses can be decreased when needed, but office leases are typically locked in for 3 to 5 years.
Think of it as the Olympic Games: if you show up underprepared and unfocused, you’ll be stuck with that mediocre performance for the next 4 years.
And yes, I am comparing your reading a quick article about office leasing to the rigors of athletic training at the Olympic level.
You’re basically a 10-minute read away from a metaphorical business gold medal. Do it for America!
If you haven’t already, check out Part 1 of this post for our best recommendations for leasing office space in the Sacramento area. This is a multi-part series for 6 tips to consider BEFORE you sign your next office lease.
Most people have lived in a home or visited a home with a “living room” that no one is allowed to set foot in. It’s usually large, located prominently near the front door, and filled with family heirlooms that are both breakable and uninteresting. Is this where the family gathers to spend time together and build memories? No, that’s the “family room”. Is it where everyone gets together to celebrate special occasions and accomplishments? No, that’s the “dining room”. Is it a sacred place Mom goes to relax and unwind after a long day? No, that’s the wine bar up the street. Just kidding.
Even if you don’t live in Downton Abbey, you’re likely to have areas of your home that never get used. That’s ok when you’ve bought the home at a fixed rate mortgage for 30 years, but it’s wasteful when you’re paying for each square foot of office space on a monthly basis.
The best way to save money on office space is to lease a suite that is efficient for your business. If you know you can operate in 1,500 SF for the foreseeable future, leasing 2,000 SF is an unnecessary expense. At an average rent of $2.00 PSF, that extra 500 SF costs you $1,000 per month, $12,000 a year, and $60,000 over a 5-year lease.
Easier said than done, right? Maybe you have three employees that insist on having their own private offices. You could move one into the conference room with the expectation they take calls elsewhere when the room is needed. You could allow two employees to work remotely once a week in exchange for sharing an office. There are ways to make your space more efficient, but you have to get creative.
Overall, finding office space can be a time consuming, headache-inducing, and non-transparent at times. If this article helps one business owner avoid at least one potential pitfall, I’ll consider the entire process a success. Remember that your office lease negotiation comes around roughly as often as the Olympics so you need to prepare accordingly. With some strategy and expert coaching (give us a call!), you can be the Michael Phelps of office space leasing. We realize that’s a less exciting version of Michael Phelps, but you’re still on the podium.