Thousands of the world’s largest companies were started in home offices. But, as your business expands, the spare room is likely to get cramped.
Moving into your first office is a major step both in your life, and in the life of your business. It can be a daunting (and expensive) prospect – so it is important that you are properly prepared.
We have compiled some top tips to help you get the best possible deal.
Your first step should be to assess your requirements. What exactly do you need from your office space? Key considerations are likely to include the number of desks and, of course, price. But your decision may also be affected by factors like proximity to transport links, amount of storage space, potential for expansion, and so on.
It is important that you have a firm idea of your needs in mind before you begin. This will place you in a strong position not just to find a property, but also to negotiate acceptable terms.
You need to do some research in order to understand the market, and to get a sense of what you might get for your money. Start by calling round some agents to get a feel for price. This will help you to start forming an idea of what you might be able to afford.
You should also give some thought to the type of premises you might want to take. For example, are you looking for serviced space, or a more conventional office arrangement? Your choice will obviously depend on your firm’s specific needs – but it will also have an impact on cost.
While the office space itself is obviously a key concern, it should not be the only factor that affects your decision. You also need to be sure that you will be able to deal with the other party to the agreement – either the landlord or, more likely, their agent.
You should ensure that you meet this party before you come to any agreement. By developing a good personal relationship you can help to maximise the chances of problems being addressed quickly and efficiently. Furthermore, in the unlikely event that you have trouble paying the rent, the landlord or their agent will almost certainly be more accommodating if they are able to put a face to your name.
There is a range of terms that only appear in commercial lettings agreements, and with which you may therefore be unfamiliar. But it is vitally important that you understand the legalese that will accompany your contract – not least because it will determine what you get for your money.
You should particularly make sure that you understand, for example, whether or not your rent also covers things like cleaning or interior maintenance.
Remember that a commercial let is a major financial commitment. You should therefore always take legal advice in order to ensure that you understand exactly what you are agreeing to.
It is vitally important that you agree on a sensible, suitable term for the lease. While you don’t want to have to renegotiate your contract too quickly, you also want to avoid being stuck in office space that is no longer suitable for your organisation.
Many tenants seek ‘break points’ in their lease, particularly if the lease runs for a number of years. These points often occur every year, and they give the tenant or the landlord the opportunity to terminate the contract after having given set notice.
It is often possible to negotiate a period in which your business can occupy the office space without paying any rent. Many landlords use this technique in order to fill their premises more quickly – and you should consider whether or not you can use it to your advantage.
You should be able to negotiate a rent-free period on a multi-year lease, but it is generally unlikely to be possible on agreements of less than 12 months.
The world of commercial lettings can be confusing, and it is one that is often weighted in favour of the landlord. This is because this party will generally have an agent to handle the process for them – and this leads to an information asymmetry.
You should seriously consider taking on an agent to help guide you through the lettings process. Information and familiarity are very important if you want to get the very best possible deal, and a good, reputable agent should be able to help you achieve this.
Keep up to date with Simply Business. Subscribe to our monthly newsletter and follow us on social media.Subscribe to our newsletter
99 Gresham Street
29 St Katherine's Street
© Copyright 2019 Simply Business. All Rights Reserved. Simply Business is a trading name of Xbridge Limited which is authorised and regulated by the Financial Conduct Authority (Financial Services Registration No: 313348). Xbridge Limited (No: 3967717) has its registered office at 6th Floor, 99 Gresham Street, London, EC2V 7NG.