Things to Consider When Choosing a Location for Your Commercial Space

Things to Consider When Choosing a Location for Your Commercial Space
John Heimbigner

John Heimbigner

Whether you’re opening your first public location or expanding to a new one, business owners tend to get more excited about finding a shiny new commercial space than they are determining whether it’s a viable one. But your company’s image and success are as tied to the right location as they are the quality of your services, making the search for the right space a critical factor to commercial viability. 

It goes without saying that many business mistakes or shortcomings can be corrected after the fact, but a bad location is something that’s nearly impossible to correct. That’s why it’s so important to consider the location of a potential new space above all else. Here’s what to look for as you begin your search:

What to Consider When Looking for a New Space

There’s a laundry list of things to look out for when searching for new commercial real estate, but before we break down the specific needs for offices, retail, and industrial space, let’s look at the basic, barebones factors you’ll want to watch out for when starting your search:

Budget – You’ll want to set a fixed budget range to avoid overspending. You’ll want to incorporate taxes, monthly utilities, costs of renovations, upkeep, and any new equipment or furniture you’ll need to make yourself at home.

Available space – Moving to a new office usually means expansion, but you don’t want too much space – or too little. That’s why your space requirements should be measured against your projected business growth over the course of the lease term. Plan to add 150-200 square feet per each future hire in an office or industrial space in addition to any equipment you’ll want to install.

Aesthetics – If you want your business positioned among high-visibility brands, you’ll want to look for space in downtown or business districts. Stores, restaurants, and personal services should aim for street-level properties or space in established shopping structures. 

Competition – Obviously, you don’t want to oversaturate the area with similar services. Opening a coffee shop next door to another coffee shop probably won’t be a successful endeavor, so do your research on companies within walking distance of your desired location before you commit. 

Opportunity for Growth – Especially important for office and industrial spaces, you’ll want to consider the ability for expansion within the building in the event that your company expands much faster than expected. While that’s certainly the ideal situation for any business, it can be a significant headache if you need to break your lease too early and relocate once again if the neighboring space isn’t available. 

Access – Parking is a major issue no matter the industry you’re in. Retail and restaurants need parking for customers, offices need space for clients and employees, and industrial firms require ample space for shipping, delivery, and storage. 

Zoning – Depending on your local zoning laws, an ideal location and space may not be zoned for your specific use. Do your homework into the available zoning designations for the space and your ability to rezone the property to meet your needs if possible. 


Accessibility – If you’re serving clients, you’ll want to ensure they have access to parking so they can come visit your office without a hassle. But even more crucially, having a location that’s convenient for your employees to commute to work can help motivate your team and help boost productivity. Check for parking, walkability, and access to public transit when looking for a new location. 

Amenities – Studies show that employee productivity increases when workers have access to sunlight, inspiring views, fresh air, and appealing lighting. While these can come with a higher price, sticking your growing business in a basement might not be the best long-term solution for improvement or retention. Secondarily, things like onsite fitness centers, cafes, and daycare facilities will help attract and retain talent. 

Infrastructure – If you’re a company that relies on high speed internet, you’ll want to look for a building wired and serviced for fiber or gigabit internet. Depending on the location, this might not be possible, but as you expand and grow, so will your needs. Ask the property owner about the building’s capabilities and investigate what internet service providers (ISPs) are available in the area. 

Proximity – Being close to thriving shops, restaurants, and bars shows that your company is operating in a growing environment – and it helps with employee morale.

Growth potential – Every office move is (hopefully) an expansion, but if you take on a larger than expected client that requires a greater headcount than you anticipated, you’ll want to make sure that the building has the capability to offer additional space should you need it. 


Demographics – Obviously, you’ll want to be where your customers are. And while location factors greatly into this (you probably shouldn’t open a dollar store in a boutique shopping mall), it’s also the breakdown of who lives, works, and visits the neighborhood in which you’re setting up shop. These can be hard to quantify, but doing some reverse-engineering on what other businesses see in a location can give you a good perspective. 

Accessibility – Ample parking, easy walkability, and access to public transit are important factors for retail spaces, no matter the city. This shouldn’t be a problem in suburban shopping malls, but dense urban areas are prime for renovation and construction, which could put a damper on a fledgling new business, so do your research on your city’s future planning before making a commitment. 

Visibility – Every company wants to be known to potential customers, but retailers need to be seen. Street-level properties provide opportunities for flashy signage, sandwich boards, and flyers, but if you’re tucked away in an industrial office mall, it’ll be harder to attract anyone but your most loyal of customers. 


Space – And lots of it. Any industrial space will need ample room for parking, shipping, and logistics, but growth should also be a consideration. Overspending on industrial space may not sound like a good investment now, but having unused space as your company grows will only lessen your headaches in the future. 

Access – If you’re dependent on your supplies and products moving in and out of your facility on a regular, consistent basis, you don’t want your vehicles stuck in snarling downtown traffic. Finding industrial space along major highways or with easy access to interstates and airports will alleviate your supply chain woes. 

Security – Look around the area – are there lots of vacancies, or is the street full of other industrial companies? Are there chain link fences and barbed wire around some properties? How’s the lighting along the road? Industrial areas are prime targets for criminals, especially if they’re deemed insecure. Check your local crime stats for the area and ask the landlord about the security features at the facility. 

What Tenants Should Ask Property Owners

We’ve covered this topic fairly extensively in the past, so we’ll keep it brief:

  1. 1. What’s the length and type of the lease?
  2. 2. What utilities and additional costs are included in the monthly rent?
  3. 3. Is the lease assignable? Renewable?
  4. 4. What happens if the building is sold?
  5. 5. Has the space been updated in the recent past?

Top Tips for Finding the Perfect New Location

1. Enlist Help

Outside of an internal search committee to help offset some of the stress that comes with a new location hunt, a tenant representation broker and a real estate attorney will help you identify appropriate locations and avoid pitfalls that come with the search. Since they’ll already have relationships and experience in the market, you could gain valuable insights you can’t find online. 

2. Take Your Time – and Don’t Jump at the First Offer

Changing a business location takes a lot of time. Expect the process to take at least 12 months from the time you begin looking. Even if you’re staring down the barrel at a lease agreement expiration, taking your time to ensure you’re finding the right location for your needs will save you from disappointment in the future. 

3. Keep Your Options Open

Especially important during the lease negotiation process, you’ll want to have 3 or 4 other properties on your “probably” list in case your first choice doesn’t pan out. That way, you won’t be beholden to a stubborn property owner and have a fallback option if they’re unwilling to meet your needs. 

4. Speak with Previous Occupants and Neighboring Businesses

It’ll take some time, but doing your homework and tracking down the previous tenant can give you insights into the condition and viability of the space in question. It’ll also give you a look into the actual relationship between a tenant and the landlord. You should also contact neighboring businesses to see if they’re familiar with the property owner and get their opinions on the viability of the space for your specific business. 

Choosing a new commercial space is a complex and time-consuming task, but if you take your time, determine your priorities, do your research, and investigate all your options, you’ll be better prepared to make this important step for your company’s future. 

John is the VP of Sales at where he leads broker relations and sales. Prior to being VP of Sales, he was the Regional  Director for the company. John has over 25 years of experience working in the commercial real estate industry. Before, John was a commercial real estate broker for the Norman Company in Seattle, WA.

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