As a business grows and expands, it’s easy to begin imagining moving into a larger, more permanent space. This is especially attractive for the startup crowd, which romanticizes the “build it in your garage” mentality while striving for the authenticity of a physical, professional office.
But moving too quickly – even in the startup phase – can have serious repercussions on your business that could hinder your growth and agility for years to come. That’s why it’s so important to consider your options and avoid the pitfalls that plague startups who choose to lease a commercial office space too soon or otherwise overextend themselves in the early stages.
Office moves always start out with excitement. The thrill of a larger space, upgraded amenities, or a better location are exactly why companies expand to a new location. But after your search, endless tours, negotiations over lease agreements, and finally signing the paperwork, the actual work begins.
First thing first, you’ll need a comprehensive relocation plan, which will help guide your organization through the physical move and ensure continuity of business.
When you’re a small business owner, you look for every possible advantage. There are no shortcuts to success, but with the dawn of shared or coworking spaces in larger cities where commercial real estate comes at a premium, it makes sense to consider your options – until you outgrow them.
Finding traditional office space isn’t a cakewalk and costs of upkeep, overhead, and utilities can shrink a small business’ already tight budget. But coworking spaces have their drawbacks, too. Reduced privacy, limited access to conference and meeting rooms, and the fact that you’re sharing with others outside of your organization may result in a credibility hit.
If you’re trying to choose between a coworking space and a traditional office lease, you’ve come to the right place. Each solution comes with pros and cons that should be closely investigated before moving forward on a new place to set up shop.
After you’ve done your research, worked with your tenant representation broker, participated in site tours, and figured out your budget, the perfect commercial real estate property is finally in your sights.
Unlike most residential real estate deals, commercial real estate is complex, complicated, and often progresses at a glacial pace. Existing tenants may need time to vacate. Major systems will need maintenance and upgrades. Build-out details will need to be verified and finalized. But until the ink is dry, prospective tenants don’t want to let a suitable property pass them by.
The answer? A signed Letter of Intent (LOI), declaring your formal interest in purchasing or leasing a commercial real estate property.
Looking for commercial office space is a tedious process. Tenants are rarely equipped to handle the complexity and scope of the commercial real estate world, which is fraught with technical terms, lengthy negotiations, and stacks of paperwork. That’s why tenant brokers exist. With their expertise and knowledge of the local market, they provide an invaluable asset to potential tenants before, during, and throughout the length of a commercial real estate lease. And at no upfront cost to the tenant, there’s little reason not to take advantage of their experience and insights.
But once you begin your search for a reputable tenant broker, you’ll be faced with the prospect of entering an exclusive broker agreement with a commercial broker. As with any formal agreement, you’ll want to carefully weigh your options before making your decision.
Whether you’re facing a much-needed expansion or simply searching for your first permanent office space, tenants would be better equipped with a list of detailed questions for each space rather than going in blind. Furthermore, knowing a few important tips about the commercial real estate world will help you gain a better understanding before your broker sets up tours on your behalf.
Once your commercial real estate agent concludes their market evaluation of potential spaces, the next step is to schedule walkthroughs and tours with the landlord’s representative.
Every lease agreement will contain a section for tenant improvement allowances – a set amount allocated by the landlord for build out, retrofit, or new construction to suit the new tenant’s needs. The amount provided is dependent on various factors, including length of lease, overall cost, and size of the tenant’s company, but prospective tenants have a few opportunities at the negotiation phase to better determine who will pay for necessary upgrades and retrofitting required before you take possession of the property.
Opening a restaurant is a costly endeavor to say the least. With so much volatility in the market and no guarantees that your establishment will take off with your intended audience, it can feel like an uphill battle before you even start the initial planning process for a new restaurant. Are you simply revitalizing a previous restaurant that’s already built out with a full kitchen, gas, and electrical capabilities? Or are you transforming a new space to suit your needs, requiring architects, designers, general contractors, electricians, and plumbers? What’s the restaurant market like in your city, and how expensive are the professionals you’ll need to bring onboard to get started?
An endeavor into the restaurant business is, needless to say, a challenging one. Establishments come and go like the direction of the wind, leaving business owners reeling and skeptical. Despite these challenges, finding the right location in the right neighborhood will reap major benefits for a restaurant owner of any experience level.
Before you start searching for the ideal spot, there are some things you need to know about leasing a restaurant space. This guide will transform any aspiring restaurant owner into a well-equipped and savvy commercial real estate expert so you and your partners can find the perfect location for your dream establishment.