Archive for Office Space
Subleased office space has become an attractive option for many companies over the past year. Markets have seen a 122% (!) surge in subleases according to figures released by Cushman & Wakefield. As businesses cut overhead costs, subleased office space looks more and more attractive … but it is not the only cost cutting option for your office space, and frequently not the best.
Shared office space, also called ‘office business centers’ or ‘executive suites,’ have been around forever and provide a similar option to sublease office space – primarily lower cost vis a vis traditional office space as well as easier lease terms. However, shared office space comes with important advantages over subleases.
Moving into office space is a coming-of-age moment for any startup. However, decisions made regarding your first office space can become an asset or can become a weight that dooms what would be an otherwise successful venture. As a shared office space provider working with start ups, there are four common mistakes that we caution entrepreneurs to avoid:
Considering businesses can reduce their rent cost by 40% and also take a month to month lease term as opposed to the standard 3-5 month term with traditional real estate, more and more businesses are considering shared office space. For both small and large business, shared office space is a very smart option to at least research and consider.
But what should someone considering a shared office space watch out for? I’d like to share some industry insider insight and give you some questions to ask when you are touring shared office space to help in your search.
In its June 10, 1956 issue, The Van Nuys (Calif.) News said the three most important things about real estate were location, location, location. Since then this phrase has become the mantra of every Real Estate Professional east and west of the Mississippi!
I would certainly agree with this notion that location is so important that it has to be the first, second, and third priority when considering any real estate purchase or rental.
Many entrepreneurs think the initial step in getting their first office is to call a Commercial Real Estate Broker and have them begin the search. After all, the lease commission paid to the agent is covered 100% by the landlord, so why not take advantage of the services of a real estate professional, right? Yes, that’s true; the tenant will not pay any of the commission on the deal, but will invariably pay in other ways.
About ten years ago, my Yellow Page Directory Salesman told me that many people open the yellow pages and decide to do business with the company that has the largest advertisement. He said they do this because they figure “at least they can afford the ad.” Of course, he was telling me this to try to convince me to spend thousands of dollars per year with his company in advertising. While this may seem absurd, there is a profound nugget of truth to my Rep’s sales pitch – Image matters! It may not be everything like Andre Agassi proclaimed, but typically during one’s first impression, perception is reality!
History: Various organized shared office space environments began to arise spontaneously in a number of places in the late 1960’s and early ’70’s. During this time, particularly in Southern California, the concept caught on with Attorneys and other law professionals who wanted to operate their own practice and yet still have access to the facilities, amenities, and prestigious image that would come with working for a larger firm. Thus “Executive Suites” were born. Read More→
