Questions to Ask Before Leasing: 10/10

Over the past few weeks, we have added to our series of helpful tips for businesses starting to look into leasing. This post is the tenth of 10 on the essential questions you should ask before signing an office lease, concluding this blog series.

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This Week’s Question: How long does the average Tenant stay in the building?

When you go to a restaurant if you notice no one is there, or people are walking out angry, the safe move is to move on to the next option. Even if the restaurant has low prices, your satisfaction will likely not be greater than those that left in anger.

This short example should guide the next question you ask before leasing a space. Learning how long tenants are staying is a building is valuable piece of information to you as a tenant. This will let you know how the building and service have worked for other businesses.

It is incredibly important to note that if the tenant turnaround is high, then it might be indicative of unhappy tenants. Another good way of determining past tenant relationships is to ask the landlord for tenant testimonials.

As the business owner, you need to make the decision on whether you want quality or quantity. Sometimes, the cheapest leasing deal is not the best for your business. Higher value is always the better option.

 

Love this series? Be sure to download our whitepaper edition, which packages all of the questions you need to ask before leasing in a centralized location! Stay tuned for our next series to start!

Questions to Ask Before Leasing: 9/10

Over the next few weeks, we will be adding to our series of helpful tips for businesses starting to look into leasing. This post is the ninth of 10 on the essential questions you should ask before signing an office lease.

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This Week’s Question: What types of Tenants are currently in the building?

Business becomes easier when those around you help, rather than hurt you. Synergy is becoming an increasingly prominent buzzword. Synergy is the interaction or cooperation of two or more organizations, substances, or other agents to produce a combined effect greater than the sum of their separate effects. In short, synergy is combining two businesses to maximize efficiency.

How can we make our businesses as effective and efficient as possible? Location.

One of the key pitfalls tenants typically fall in when looking for an office space are their neighboring tenants. Before you sign the lease, it is incredibly important that you know who is in your building. If possible, choose a building that has businesses that complement your own. Synergy is especially important in a medical building.

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By choosing a building with synergy, you choose a location that increases your chances at success. Foot traffic to successful businesses and increased credibility are just a few of the benefits you receive when you choose a synergistic space filled with successful businesses. Through synergy, your business has the highest chance of success.

 

Stay tuned for next week’s feature on the importance of knowing how long the average tenant of your prospective building stays!

Questions to Ask Before Leasing: 8/10

Over the next few weeks, we will be adding to our series of helpful tips for businesses starting to look into leasing. This post is the eighth of 10 on the essential questions you should ask before signing an office lease.

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This Week’s Question: Does the Office space fit into your company’s needs, image, wants, comfort and vision of success?

 

One of the key reasons to move into an office space is its ability to add credibility to your business. However, without the right office space, your image could suffer.

Your office is a visual representation of who your company is and the image you wish to project to your employees, clients and customers. Be sure that your selected office space is easily accessible and in a prime location. The building should provide all of the amenities and comforts within not only your own office space, but within the common areas.

A good way to judge the merits of a particular office space is by putting yourself in the shoes of your prospective stakeholders. By imagining the space through their eyes, you increase the likelihood of finding a space perfect for everyone important to your business.

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It is incredibly important to find out what all of your building amenities are and how accessible they will be to you as a tenant. Your office space projects a large portion of who you are to the outside world.

Stay tuned for next week’s feature on the importance of knowing what types of tenants are currently in your prospective building!

Questions to Ask Before Leasing: 7/10

Over the next few weeks, we will be adding to our series of helpful tips for businesses starting to look into leasing. This post is the seventh of 10 on the essential questions you should ask before signing an office lease.

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This Week’s Question: Can the office space be modified to meet your company’s future business needs?

 Businesses evolve on a continual basis, growing and shrinking based on market forces. Inevitably you will need to change the space you start out with. But what do changes to your space look like in a lease?

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The changes may include expanding or downsizing, adding a kitchen area, or completely redesigning the configuration of the office space. It is always best to determine what changes the landlord is willing to do accommodate and what the applicable charges will be, before signing the lease. While it may be difficult to know what your plans are down the road, you should ensure that you have the flexibility to change your space to meet any potential need.

(Insider Tip: Get your landlord to provide you with a Right of First Refusal option under the terms of your lease for any space that becomes available adjacent to your suite, if possible)

Some property managers offer a phenomenal agreement known as “portfolio leasing.” In portfolio leasing, tenants are able to move from building to building within the property manager’s buildings. Should you need additional space and can’t take the suite next door, you have the opportunity to move to another building with a larger suite without breaking your lease. As the tenant, you hold a great deal of power in determining the specifications of your lease. Since most leases typically span 3-5 years, make sure you make the right decision with a flexible landlord

 

Stay tuned for next week’s feature on the ability for your office space to meet your company’s vision for success!

Questions to Ask Before Leasing: 6/10

Over the next few weeks, we will be adding to our series of helpful tips for businesses starting to look into leasing. This post is the sixth of 10 on the essential questions you should ask before signing an office lease.

 

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This Week’s Question: What access does a Tenant have to the building?

We’ve all been there. You forget your laptop or a crucial piece of work and you need to go back to the office. But what happens if the door is locked. The simple truth is that some property managers still don’t provide 24-hour access to buildings for tenants.

If your business requires access to your suite 24/7, you need to find out what the regular operating hours are and if you will be able to have building access after those hours.

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However, it doesn’t end there. Some property managers promise 24-hour access to buildings, but fail to offer services that you would expect. For example, you will need to know if you will be able to control heating and cooling and access to common areas after regular business hours. It’s best to determine what services the landlord provides during regular business hours and what to do should you need to have access to those services after regular business hours.

While you may not typically need access to your space after regular business hours, it’s important that you know what to expect before signing your lease.

 

Stay tuned for next week’s feature on the ability for your office space to meet your company’s future business needs!

Questions to Ask Before Leasing: 5/10

Over the next few weeks, we will be adding to our series of helpful tips for businesses starting to look into leasing. This post is the fifth of 10 on the essential questions you should ask before signing an office lease.

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This Week’s Question: Where is the Property Management located?

You start your lease with a fresh office, new paint, new carpet, and perfectly functioning utilities. But what happens when something breaks? It’s up to your property manger to take care of your issues.

The Property Management company, or division, manages and takes care of the building and building tenants. They also deal with any issues that may arise during your lease such as power outages, malfunctioning elevators, security issues, HVAC issues, and additional work to your suite.

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While it may seem like common sense, it is very important to have a management team that responds to your concerns and issues in a timely and personal manner. There is nothing worse than only being able to speak with an answering machine or send an e-mail when you have an issue that requires speaking directly with a person or immediate attention.

There is nothing worse than only being able to speak with an answering machine or send an e-mail when you have an issue that requires speaking directly with a person or immediate attention.

A property management team that is close is always better. By having a dedicated group of individuals committed to meeting your every need, you can guarantee you will have a positive office experience. Always include your property management team’s reputation in your leasing experience.

 

Stay tuned for next week’s feature on the differing amounts of access to your location!

Questions to Ask Before Leasing: 4/10

Over the next few weeks, we will be adding to our series of helpful tips for businesses starting to look into leasing. This post is the fourth of 10 on the essential questions you should ask before signing an office lease.

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This Week’s Question:

What is the difference between rentable and usable space?

When you lease a space, you may be overwhelmed by the amount of information presented to you. One of the most essential aspects of a lease is the space. However, there is a large difference between the rentable space and usable space.

Every building includes space that is not rentable and includes common area space such as the lobby or entryway, hallways, stairwells, elevators, phone rooms, electric rooms and storage spaces.

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It is important to find out what percentage of the building is dedicated for all common areas and if you are paying for usable or rentable square feet under the terms of your lease. If you are paying for rentable space, it’s crucial you make sure that the landlord is paying for all of the utilities in the common areas, especially if you are paying a proportionate share of the electricity for the building based upon your square footage.

The common area factor is calculated as a percentage of the building and is added to the total usable square footage leased. Simply put areas that are shared among your fellow tenants are added to the usable square footage.

 

Stay tuned for next week’s feature on the effects of property management location!

Questions to Ask Before Leasing: 3/10

Over the next few weeks, we will be adding to our series of helpful tips for businesses starting to look into leasing. This post is the third of 10 on the essential questions you should ask before signing an office lease.

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This Week’s Question:

What is TI and what does it cover? What is included in the building’s “standard” build-out.

 

 

When you begin the process of leasing your new space, you may wonder what the next steps will be to get your space to look exactly as you’d like it to.

“TI” stands for tenant improvement and is what the landlord will pay, at no cost, to build out the suite for you. “Build out” is how your office space will be designed to fit your individual business needs. There are specific items that are considered industry standard build-out items, including, drywall, painting, doors, flooring, lighting, HVAC, ceiling and electrical components. It’s important that you know what “standard” includes and what the associated costs of upgrading are before you lease. Examples of upgrades include glass doors, parabolic lighting, keyless entry, carpet borders, plumbing for kitchen area, additional electrical, phone/data wiring, carpet borders, alternate flooring, and upgraded ceiling tiles.

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Always be sure you have a fully priced proposal for the layout itself with all of your changes from the original design. The detailed proposal will let you know if the building allowance offered by the landlord will cover all of the changes you want, as well as determine any out-of-pocket expenses for the floor plan. Any additional charges for the suite design are typically due at signing, or they will be amortized through the lease term adding more cost, ultimately affecting your bottom line. You also need to find out how flexible your Landlord is with outstanding balances from construction. Ask the landlord if they offer any “turn-key suites.” “Turn-key suites” include all the build-out expenses required to get the space ready for your business, drastically reducing your overall cost.

“Turn-key” suites are great for reducing cost, but not necessarily for fulfilling all of your needs.

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Stay tuned for next week’s feature on Rentable Space v. Usable Space!

Questions to Ask Before Leasing: 2/10

Over the next few weeks, we will be adding to our series of helpful tips for businesses starting to look into leasing. This post is the second of 10 on the essential questions you should ask before signing an office lease.

 

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Besides base rent, what other things might a tenant pay for?

 

Hidden costs can add up tremendously when you’re leasing a space, that’s why you need to understand some of the basic elements of additional costs. Let’s break down the basics.

 

Utilities – Tenants are typically responsible for paying utilities which usually include gas, electricity, and in some cases water. It’s crucial that you know exactly what you’re expected to pay.

(An Essential Tip) : You should find out if your suite will be separately metered, if heating and cooling are part of CAM or yours, or if you will be required to pay for a proportionate share of the entire building. If there is only one meter in the building, you need to know what the hours of building operation are and what else may impact the utility charges as it may have an impact on your overall budget.

Internet – find out who the internet provider is in the building – if you’re lucky your property management team will provide high speed internet at affordable packages. Ask if the landlord has any special price packages for you to sign up with a specific provider. Be sure to have your IT person check out all of the suite components to be certain they will meet your business needs.

Telephones – determine if your current telephone provider is available in the building. Find out how easy it would be to port your current phone number if your current telephone service provider is not available in the building. Ask if voice over internet phone (VoIP) service is available and if the landlord provides any special deals for you to use the same service.

Janitorial service – find out exactly what cleaning services are provided in your suite under the terms of your lease. Since cleaning service is done after regular business hours, be sure to ask your landlord for references or background check on the cleaning service and its personnel. It is important that you feel comfortable with the company being used by the landlord

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While these are just some of the basic costs associated with leasing, there are many to keep a look-out for. Always make sure you read through your lease and understand the terms. Don’t be afraid to question things you don’t fully understand. Your future landlord should strive to provide services that fulfill your needs.

Stay tuned for next week’s message on Tenant Improvements!

Questions to ask before you lease 1/10 : Is it a GROSS or NET Lease?

Over the next few weeks, we will be adding to our series of helpful tips for businesses starting to look into leasing. This post is the first of 10 on the essential questions you should ask before signing an office lease.

 

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  1. Is it a GROSS or NET lease?

 

For businesses or doctors that are just starting to look into leasing office space, the terms gross and NET lease may seem foreign. However, there are significant differences between a gross and NET lease– let’s break down the basics.

 

With a GROSS lease the following items are included in the rent price:

 

  • Basic rent
  • Property taxes
  • Heating & air conditioning maintenance
  • Cleaning service for all common areas
  • Use of any building amenities
  • Pest control
  • Landscaping & snow removal
  • Parking lot maintenance
  • Janitorial service for your suite

 

With a NET lease, the tenant is responsible for paying all of the items listed above separately based upon a proportionate share of the building.

 

The payment share is based on the previous year’s building expenses and is calculated by the landlord. The tenant will pay an initial amount to cover what was spent in the previous year and at the end of the year the tenant will get a charge back for the difference along with documentation to show where all the capital was spent.

 

Now I know what you’re thinking…”Why in the world would I want a NET lease?”

 

The simple truth is that neither lease type is better than the other. Both lease types benefit businesses in different ways.

 

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The largest caveat to look out for in a NET lease is an increasing building expense cost. At DynaCom, we try to help our tenants as best as we can by capping the excess cost. By creating a cap, tenants can rest easier in a NET lease knowing they will have a consistent or lower building expense cost. If you are leasing NET try to get your leasing agent to ensure there is a cap to the cost.

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