Things to Know Before Signing a Lease for an Office Space
In layman’s terms, a lease is a binding contract between you (tenant) and the landlord. Remember, signing a lease contract is not only about negotiations to get a low price. The entire process is complex and requires deep analysis.
Top 5 things to Know Before Signing a Office Lease
In order to be in a position of strength, you need to understand the basics of renting commercial spaces in the market. Secure your position as a tenet by keeping these five important things in mind –
1 – Well Connected Location
Location is a well-sought aspect when it comes to buying a new property. Whether it is for commercial purposes or personal, a well-connected location is always preferred. Go for a location where there is high foot traffic. A Location near major establishments, shopping malls, government spaces, etc. is the best for commercial purposes.
Ask the following questions to make sure it’s the right direction to move forward –
- Does the location you are looking for is near public transport?
- Is it easy to find on the Google Map?
- Is the location accessible to your employees, your customers, and you?
- Is the location connected with a major road or the back road?
- Is there any major landmark?
- Is there a bank/ATM nearby?
If you find the answers to these questions satisfactory then you can move to the next process.
2 – Know your Budget
Buying an office on rent, in general, is expensive. So, before moving on to look for an office space for rent, it’s best to set a budget. For instance, you find a perfect office for your business but you don’t have a budget to afford it. To avoid situations like that, set a budget, to be sure where you stand in the market.
There are several other things that are part of the overall lease expense. Office rent is just a fraction of it. There are additional expenses when you move along such as – renovation, sanitization, permits, equipment, insurances, and much more. Therefore, check carefully what is being provided by the landlord.
To calculate your overall budget, go through these points –
- Add expense for office maintenance and cleaning.
- Go with systematic planning and avoid unnecessary expenditure.
- Don’t lease more space than you actually need
3 – Time-period of Office Lease
Next to consider is the length of the lease. Will your occupancy be short term or long term? Based on your requirement, you move ahead with the signup process. It’s best to go for two or three years time period if you are just starting out in the market.
5 or more years is viable if you have the means to pay. However, a short-term lease is always a safer and viable option.
Check the following points to make a wiser decision –
- If you are not ok with the long-term lease, you can go for a co-working space.
- If there is a choice to extend the time period with the existing rate.
- Check all the terms and conditions if you exit early like penalties and extra charges
4 – Don’t Be Shy to Revise
Sometimes, revisions for things like rebuilding, repairing, extra rooms, etc. are inevitable. In such scenarios, make sure to determine all the terms and conditions of the lease. Furthermore, if you perform such activities in the office area, who’s going to pay for the improvements.
Make sure your office lease is flexible in nature. You can ask for some revision to your landlord such as –
- Check the conditions for the sublease with your landlord.
- Check if there is an option to buy (rent-out) property.
- Make sure to ask for protection and security against unnecessary occurrences.
5 – Get a Real-estate Agency/Broker
Buying or leasing office space is time-consuming and somewhat difficult to handle. There are things such as legal complexities and other many things. Which is overwhelming for someone new with buying and leasing. A real estate agency or broker is a great option to go with. They can take care of all the legwork including from finding a property to paperwork. Furthermore, they can also deal with parties on your behalf.
When you buy or lease a commercial space, it’s important to have a strategy. Planning ahead will help you in avoiding many obstacles and challenges. If done properly, you will be able to get the desired working place with all the elements necessary.