After choosing your company’s ideal office, it’s time to brace yourself for the contract negotiations. For most entrepreneurs, negotiating office space for rent that fits within the budget and addresses all the current and future office space needs for the company is the most complicated part. Below are five questions you need to ask yourself before signing that contract for a short term or long term office lease:
Where do you see the company in the next 5 years and what will that mean to your office space needs?
The ideal office space for your company today may not work for you in two or three years’ time. As such, you need to take into consideration the projected growth of your company in the next 5 years and negotiate accordingly.
Do you need to make some improvements to the office before moving in? If yes, is the landlord willing to pitch in to make those changes happen?
It is very common for tenants to conduct some personalized changes to the office space before moving in to ensure that the office runs as smoothly as possible. When negotiating the terms of a lease, you need to know where the landlord stands when it comes to paying for improvements you deem necessary. In most cases, the landlord might be willing to come to a compromise if you choose to go with a long term lease. For short term leases, be ready to pay from your own pocket.
What is the expected trend in office rental rates during the next 3-5 years?
If the current trend suggests an imminent rise in rental rates during the next few years, it is advisable to negotiate a longer lease term. That way, you get to enjoy today’s rates for, say, the next 5 years.
Does the office location dictate the success of your business?
Depending on your company, you might need an office that is conveniently located near your clients to make interaction easy. For instance, it would make sense for a law firm to secure an office near a courthouse. In such a case, a long term lease would be reasonable. On the other hand, if the location of the office does not have any implications on the success of your business, you can be more flexible with the terms of the lease.
Does a long term lease mean a better deal for me?
The answer is most likely yes! Most long term leases tend to offer better terms as opposed to short term deals. If that is the case, why not sign a long term lease and enjoy all the perks that come with it?
Although the lease period is just one of the many aspects you need to carefully consider during the negotiation process, be sure to weigh in all the short term and long term space needs of your business before signing the contract.