5 Traps to Avoid when Negotiating Office Space
Don't fall into these traps when choosing and negotiating office space.
Here are 5 traps (to avoid at all costs!) that many office tenants get caught into when choosing office space and negotiating their lease terms:
- Not Looking Ahead
It's easy to forget about the future of your business when trying to find office space. Think 5-10 years ahead about the future of your business; the size and what additional facilities you might need. This will enable you to choose an office space which you won't grow out of too quickly. Use the Office Space Calculator to work out your size requirements, and add an additional 10% to factor in growth.
- No Sub Lease or Break Clause
Sub leasing provisions and break clauses provide for flexible and contigent plans, particularly for smaller businesses - whose financial projections may be more uncertain. Try to negotiate the ability to sublease some or all of the office space in the event your business takes a downturn and you cannot afford the rent. Similarly, a break clause provides you with a "get out" prior to the lease expiry which can prove invaluable in the event of economic or business downturn.
- Thinking you don't need a Solicitor
Office leases can contain clauses that are confusing and sometimes even harmful to your business, particularly if they are not worded correctly. Having a Property Solicitor by your side will assess your risk tolerance as far as the lease is concerned and ensure everything that's been agreed is correctly documented to protect your company's best interests.
- Not Understanding All Costs
The office lease will not only set out how much rent is payable (and when), it also explains your tenant obligations in terms of upkeep costs, repairing obligations, service charges and insurance. Make a note of all these costs within your Moving Office Budget to double make sure you can financially afford them.
- Making Hasty Decisions
Hasty and rushed decisions are a result of poor office move planning and leaving things to the last minute. To give yourself enough time to make informed decisions and give yourself plenty of negotiating leverage, plan well ahead of your current lease expiry. Don't be forced by anyone to sign anything that you're not sure about, or this could cause dire financial consequences for your business further down the line.
Find a Property Solicitor in your area here to ensure you don't fall into these common office leasing traps.