Over my thirty-one year career as a real estate broker specializing in office space, I have seen both good and bad examples of how to conduct the relocation search process. One of the primary differences is the effort invested in the beginning of the process to fully understand the requirement. This is commonly referred to as "needs analysis". It is so important that if it is not done, you will probably be wasting a great deal of your own time.

Its easy to understand why that would be, since each space and each building is unique and your requirements, though they probably have some flexibility, have certain characteristics that are needed to benefit your business. By way of example, some companies have a high volume of incoming and outgoing mail. It would be highly advantageous for such companies to have an exit door directly to the mail room so that the delivery people can pick-up and deliver to one convenient spot and the mail can easily be distributed from that location. Other companies have many visitors and want their space visible from the elevator or lobby as the case may be.

The best approach to begin a relocation search is to first think about your current space in a critical manner. What works and what could work better? Then think about what the most efficient functioning of your business would be like. Now construct a model, (draw a picture in as much detail as you can) of what that would look like. Once you have completed this exercise you will be prepared to work with the professionals in the process of finding the right space for your company.

Next, you need to have an idea of the cost of the space. In order to do that you need to have an understanding of the current market in your geographic area. If you can consider various geographies, you will need to gain knowledge of each. The basic points of information you need are: How many spaces are currently on the market that can accommodate your space requirement? What is the overall vacancy factor in the specific market area? What is the asking rental rate? What concessions are common for the size and type space you require? What were the taking rents on the last few deals done recently in the market? A good office leasing broker will have that information. They should be able to present you with a professionally prepared market report and review with you those statistics that specifically relate to your situation. As we all know, statistics can be misleading, so having your broker interpret the report for you is extremely important. Just imagine how off-base you could be if you thought a market had a 20% vacancy, when 18% of that vacant space was totally antiquated space that most companies would never occupy.

 One important tip that may seem obvious... make sure you accurately and completely communicate the information concerning your requirements to your broker and space planner so they can hone-in on opportunities that will best fit your company's needs. Then, if your broker isn't showing you properties that suit your needs, you probably are not working with the right broker.

 This article republished with permission from our friends at the Office Space Blog

After you search a market for locations that suits your needs and you have created a short list of buildings, you will need to evaluate the specific layouts of the available spaces in each building. This can be done in a variety of ways. Assuming you have a good idea of the quantity of space you need, (a good subject for another discussion), you will need to obtain a copy of the "as-built plans" for existing suites or the floor plans for unfinished space.

Some buildings will have their architect provide you with a layout of your space needs known as a"test-fit" or you may choose to have your own architect evaluate the various alternative locations on your behalf. While this latter method does cost money up-front, it can potentially save you money in the long run. The test-fit is derived from a program you will need to provide to the architect which specifies the number and sizes of each room you require and their adjacencies. The architect's job is then to arrange your needs within the available space in a manner that best suits the operation of your business. By way of example, if you have a sales department and a production department that have to communicate frequently, you would want them to be located next to each other, not at opposite ends of the space.

Each space will have its own unique elements. The distance of the front entry relative to the elevators, lobby, bathrooms; the floor within the building; the exposure (direction the windows face); the ceiling height; the distance of the common corridor to the outside window wall and the physical shape of the space all matter, (some points more then others), depending on your needs and preferences.

Once you begin comparing the various layouts, you will see that some fit your specific needs better then others. In one building all of the private offices may fit on the window wall and that may be one of your preferences. In another building the available suite may have its entrance right opposite the elevator which may also be one of your preferences. In the final analysis, you will need to consider the strengths and weaknesses of each of the opportunities and make the judgement call of which is overall best suited to your needs.

This article republished with permission from our friends at the Office Space Blog

This subject is has as many angles as your high school geometry class. Common area in a multi-tenanted office building is the space contained within the building that is outside of any tenant's premises and therefore, by definition "common" to all tenants. It can be expressed either as an "add-on factor" or a "loss factor". The former being added to the useable measured space and the latter being deducted from the grossed-up "rentable area". "Rentable area" is the quantity of space upon which your rent is calculated. 

There have been real estate industry organizations,like BOMA (Building Owners and Managers Association), that have established definitions that exclude "vertical penetrations", which would mean stairwells, shafts and elevators, to attempt to level the playing field between buildings, but the real problem is that virtually no tenant would ever attempt to disprove the claim of a landlord concerning his common area. The reason being, one would have to measure the entire building and all of the various components to determine the common area.

Let me give you an example to clarify: Suppose you wish to rent 1,000 square feet of space in a multi-tenanted office building. The space may measure 1,000 square feet, but because the building has a 15% add-on factor for common area, you will be paying for 1,150 square feet of space. Within the common area in the building will be the lobbies, hallways, bathrooms, utility closets and mechanical rooms. These areas are all necessary for the operation of the building and there combined space is distributed among the tenants in the building.

Now comes the twists and turns of "common area". What happens when a floor in a multi-tenanted building has only one tenant and therefore, no hallway space? Or, what if additional corridor space needs to be created in order to accommodate an additional tenant on a particular floor? Another area of contention is the actual measurement of the space. In the office leasing business, space is measure from the inside of the window to the outside of the corridor wall and from the center of all demising walls, (defined as walls that separate two leased premises). Physically, in order to measure that space accurately, it would have to be totally without interior walls, a condition normally found only in new buildings or where complete interior demolition has occurred. Reliance on measurements from plans is not considered industry standard practice unless the plans are actual "as-built" plans meaning that they have reflect the measurements of the space after the building was constructed.

From a practical matter, "common area" should be taken in context. By that I mean, that the space you are renting of 1,000 square feet, like the example above, at a rental rate of say $20.00 per square foot, (gross, full service) will cost you $23,000 per year, not $20,000 per year. If you cant afford the $23,000 you need to consider leasing less space or finding a building that charges a lower rental rate. Can you find a building that doesn't charge for common area? Yes, there are some rare examples, but then you will have to pay for common area maintenance (CAM), so it works out to virtually the same thing. If you rented space in a one story building that had separate entrances for each tenant and separate bathrooms for each tenant, you would not be paying for common area, but you would be paying for the space for your vestibule entrance and for your bathrooms. Do some buildings charge more for common area then others? Yes, generally because they have more generous common areas which typically denotes a higher quality building.

My best advice is to shop around and once you see what's available and what best suits your needs, then you can determine in specific cases whether the common area is in line with the rest of the market or if not, if it worth the extra cost to you?

There's the steak and then there's the sizzle, right? But sometimes the sizzle is what makes the steak worth the extra bucks. When it comes to amenities in office buildings, amenities can play an important role in attracting and keeping quality employees. They can also play a role in making those employees more productive during their working hours or making their lives a little easier.

What kind of amenities are most often available in an office building? In order of popularity I would say:    1. Parking  2. Cafeteria/Restaurant/Coffee Shop  3. Bank/ATM  4. Sundry Shop  5. Concierge   6. Health Club  7. Day Care  8. Dry Cleaner  9. Shoe Shine  10. Car Wash  11. Office Supply  12. Beauty Salon/Barber  13. Post Office/Mail Handling Shop

Now think about the employees you have, or want to have. Would having any or all of the above amenities in or near your office be advantageous? How about on inclement days when you don't want to leave the building? How much time could your employees save by staying in the building versus going out for lunch over the course of a year? Think about all the convenience of having these facilities at your building so employees don't have to go running around wasting valuable time during the work week for goods and services they need.

Of course, an argument could be made for avoiding leasing office space too close to clothing stores, sporting goods stores or any "non-essential" stores where employees could wind up browsing and wasting valuable work time. There is a line between the types of stores that can help or hinder your employees productivity.

Overall, amenities usually cost the landlord some expense which is passed along in the form of rent to the tenants. If you are comparing equal quality buildings and one has a good complement of amenities and the other doesn't, it wouldn't be a surprise to find the one with the amenities to be at a higher rental rate. If the difference is less then ten percent, it maybe a no brainer. More then ten percent and you have to think about the value to your organization.