Renewing office space is no small matter. Most leases lock you into your space for five to 10 years, with a significant amount of money on the line. As your current lease draws to a close, you gain a unique opportunity to best meet the evolving needs of your business — whether that means staying put or moving to a new space.
Looking at the trends in the workplace and using data to evaluate your business are two important ways you can make good decisions. If you're facing lease renewal, consider these four key factors to secure a good deal and settle into a space that meets your business needs.
Whether you renew an existing lease or sign on the dotted line for new space, the more time you have on your side, the better. You wouldn't invest in anything without doing your due diligence and making sure you're getting the best deal. Your office space deserves the same time and attention, particularly considering the savings potential you could lose if you start too late. To negotiate the best terms, you want to come from a position of being proactive, not reactive.
The standard time frame to work within depends on the size of the space you need, as noted by Aquila, one of the premier commercial real estate firms in Austin, Texas. If you're looking for something that's larger than 25,000 square feet, you need anywhere from 18 to 24 months because limited inventory is typically available. For spaces between 10,000 and 25,000 square feet, it's standard to renew within a year of lease expiration. Businesses in need of smaller spaces typically get started anywhere from six to 12 months before lease expiration.
We're living in uncertain times. It's arguably more important than ever before to have a deep understanding of what your business needs to operate efficiently and comfortably. In the post-COVID world, most businesses are moving away from dense, open layouts to follow physical distancing guidelines and help employees feel safe as they return to the office.
To gain the knowledge necessary to best decide what's needed from your office space, you need actionable data insights that tell you exactly what and how you're utilizing the space you have. For example, the sensor technology that 4Site offers delivers data on points like:
During the age of COVID-19, the majority of businesses are working remotely. Some businesses plan to stay that way. PwC's June survey of 330 leaders in the finance industry revealed that 54% of CFOs plan to continue giving their employees the option to work remotely on a permanent basis.
Even before the pandemic, remote work was catching on more and more. More than 40% of United States workers worked remotely at least occasionally according to Business 2 Community. PwC's research shows that after COVID, most employees would still like to have the option of working from home. More to the point, three out 10 executives are already considering scaling their space down because of the number of employees likely to work from home.
That makes sense. Fewer employees in the office day-to-day means less square footage needed. While you're evaluating your office space requirements, consider how many employees will return to onsite work full time and how many will work remotely one or more days per week.
Experts recommend allocating roughly 120 to 500 square feet of space for each onsite worker, depending on the type of floor plan you're working with. In the modern, post-COVID workplace, you'll need to consider spacing between desks and ample room in conference rooms and shared spaces to allow for physical distancing as recommended by local and federal guidelines.
Renewing office space is a bit like trying to see into a crystal ball and predict where you see your business in the next five to 10 years or so when you don't rely on actionable data. Do you anticipate adding more staff? If so, when do you plan to hire them and what type of staff will they be — administrative, sales or executives? Depending on the answers, you might need to add 10% to 20% to your square footage estimates to accommodate your growing business.
There's a lot of unknown in the mix, but it's crucial to consider these questions to get a handle on the amount of space you really need. For example, if you're planning to add more workers, but employ a robust remote work option, you could scale down instead of renewing your existing space.
This underlines the importance of having data on your side. With sensor technology, you can better ascertain how your office space is being used to determine how efficient it really is. Actionable data is the key to making sound decisions that could very well save a substantial sum while helping you choose office space that best suits your business needs.