Primer on the Search for Office Space
Business to Business Monthly Magazine
Date -- September, 2000 - By Bill Milliken, CCIM
Ann Arbor Area Chamber of Commerce
To Lease or Not to LeaseThere are many reasons businesses lease real estate. Not the least of these is the fact that someone else may own the prime location a business has to have. Other reasons to lease are: the "flexible financing" it provides, the relatively short-term commitment it requires, or the ease with which a lease can meet the space needs of a rapidly growing company.Know anyone who has relocated their business recently? It does not always go well. Some people would rather have major surgery than move again. Of these, some tenants were just plain unlucky. Others could have managed the process better and saved themselves and their companies lots of lost workdays -- and stress.
Planning, Planning, PlanningRegretfully, there are no rules etched in stone about when to begin planning a company's move. The rule that may as well be etched in stone, however, is that your current lease has an expiration date; and your landlord may rent your space to someone else after that date. In other words, you could be out on the street -- unless you plan ahead.
A Year Ahead?The actual timing is driven by many variables: space availability in the market, company size, necessary specialized improvements, etc. But try starting as much as a year ahead. Doing so will give the company a sense of the market, give them a chance to learn what the supply of available space is and how much it costs. If you use a brokerage firm, it will also give you a chance to see how you and your broker work together. The bad news is that neither landlords nor brokers are going to brim with excitement when they hear from you at this early stage. But the interests of the company are at stake, aren't they? Think of this period as the insurance premium you pay toward your successful move.
Comparison ShoppingLook at enough properties to make a useful comparison of them to each other. Include your current space. Compare price, amenities, construction quality, neighbors and parking. Also, check out the landlord. Who owns the building? What is their reputation in the market? If you are a tenant, who will you call when the property needs maintenance? Try talking with neighboring tenants about their experience in the buildings.
Homing In On The Right AddressOne or two of the prospects will rise to the top. When the tenant is required to pay the cost of utilities in these suites, check to see if it is separately-m
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Bill Milliken, CCIM
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