3 Mistakes to Avoid When Leasing the Office Space
Negotiating a lease for the new office space can be challenging as well as confusing. Perhaps that’s the reason why signing on bad lease terms may even spell disaster for your business.
Most of the landlords & tenants discuss all aspects like base rent & concessions in detail before signing any lease agreement. The lease agreement is supposed to establish your relationship with the landlord. Not only it sets down the rules & regulations for your day-to-day relationship, but also for what happens when something goes wrong. It’s very common for entrepreneurs looking for office space to go wrong at some point especially when it’s about the lease.
Owners & decision makers make several mistakes that often end up costing them huge down the line and may even cripple their growth rate in the long run. Since rent is the 2nd highest expense the vast majority of companies deal with, overlooking the important aspects and doing things the wrong way that lead up to signing the lease agreement can be devastating, especially if it’s the startup. Here’re a few mistakes you must avoid while signing a lease for office space. So let’s dive in;
Not Determining the Current & Long Term Priorities
This is where most of the startups go wrong. They often neglect to determine the current and long-term priorities. For that, you just need to relax and jot down every single point what’s going to be important for your company in the long run with regards to the office space. Below mentioned is a checklist you can have a look at as an example;
⦁ What image should office space reflect the customers, prospects, and employees?
⦁ What could be the best possible corporate environment does my business call for in the office space? It’s
better to go for an open environment as it creates collaboration amongst employees and management.
⦁ How much can I afford to make my office space look more professional?
⦁ Does the current office building/Landlord leverage additional options to grow business with a very few
Choosing the Wrong Broker
Whether it’s choosing the wrong broker or maybe not sticking to one at all, it’ll turn up a costly mistake for any business in the long run. From searching a good office space for renewal, it often takes between 2-months to 2-years depending on many different factors. Perhaps that’s the reason why it’s imperative to ensure that you and the broker get along otherwise it might turn up miserable experiences.
As we all know, the office space lease is probably the 2nd largest expense. That’s why the right broker can help reduce a huge expense in your company’s bottom-line and must be able to protect your company’s interest on non-economic terms also. The broker must be aware of the submarket that you’re inclined towards. As per experts, a good broker should predict and negotiate the reasonable final rent of your office space.
Not Taking In Account Other Associated Costs
Most of the companies go wrong here as well when trying to determine the future office space location. It’s all because most of the renters are so much into rent that they overlook other expenses coming along with office space. Here’s a checklist of the basic expenses a tenant must understand before signing a lease for office space rental in Dubai.
Before signing a full-service lease, see what the base year is going to be. Then you’ll have to check out the building’s historical operating expenses and figure out how much they’ve gone up over the years. For obvious reasons, the increase in expenses will be passed through to the tenant.
Make sure you see how much it’ll cost to set up the phone systems, internet and intranet etc. Whether you’re expanding in the current location or moving to the new one, tenant needs must be determined before making any decision.
Just ask yourself! Do you need new furniture or you’ll use the one you have a new one? If you’re buying, will you prefer new or used? How much will it cost to break down old furniture and move to a new space? It’s better to speak with a furniture vendor in order to understand the cost of both options.
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