Are you making preparations for a new lease agreement?
If you are, you should consider these leasing mistakes to assure that you’re not already making the same mistakes. As an office tenant, you want to secure a deal that you feel comfortable moving forward with. Outlined below are the worst ways to go about accomplishing that.
Common Leasing Mistakes:
1) Only Focusing on Costs
If cost is your sole focus, you’re not going to find a property that best suits your business. You have to weigh cost with other important considerations like location and office space.
2) Not Planning Ahead
If you’re waiting until the last few months to start planning, you’ve waited too long.
3) Negotiating at the Last Minute
This is also plays into not planning ahead. When you’re negotiating last minute, you’re losing all the leverage in negotiating strength.
4) Not Knowing the Proper Amount of Space You Need
Not knowing or miscalculating the space you’ll need is a mistake many office tenants make. There are real estate companies that you can look to, to help you calculate the amount of space your business will need.
5) Failing to Have a Project Lead
Someone needs to be in charge of accomplishing certain steps in the process. Many businesses will make the mistake of not assigning a project lead and they’ll end up paying for it when it isn’t effectively managed.
6) Not Consulting a Real Estate Broker or Tenant Representative
Brokers understand the ins and outs of the industry and market. Not only can they successfully negotiate your lease to a less expensive price, but their advice and guidance is essential.
7) Not Calculating for Growth
This is particularly important when signing a long-term lease. If you don’t account for growth, you might not have enough space in your office for employees you need.
8) Failing to Think of the Big Picture
When securing an office, there’s a lot to consider. Businesses need to be asking the important questions to understand if an office is the right fit or not.
9) Not Thinking About an Exit Strategy
Always have a backup plan.
You have no idea where your company is going to be in 3-5 years. Incorporating an exit into your lease terms allows you to account for anything that goes wrong.
10) Getting Too Attached to a Single Property
This is a huge disadvantage. No single property will decide your company’s success, and you shouldn’t treat it that way. If you have an emotional attachment to an office, you’re limiting your options, and opening yourself up to an unfair deal.
11) Agreeing to Terms Too Quickly
Take some time to consider your lease and its terms prior to agreeing to them. A lot of times when companies get stuck on a particular property, they’re quick to jump the gun.
12) Not Inspecting the Contract Thoroughly
When you lease an office, you can expect a lot of paperwork. Read through all of the documents fully to make sure the office is legally zoned, and that codes are in order. Have certain elements of your office inspected, such as the HVAC unit.
13) Not Fully Understanding Lease Terms
You’ve read through your leases terms, but you don’t take the time to fully understand it’s ramifications. You shouldn’t agree to a lease if the terms designated are unfair. Here are some examples you should be wary of:
- Common Area Maintenance (CAM) Fees
- Landlords Terminating a Lease at Any Time
- No Right to Legal Help
- Relocation Within the Building
14) Not Checking Out Building Infrastructure
Especially pivotal when looking at older buildings is verifying mechanical infrastructure. Avoid potential surprises by inspecting the building ahead of time.
15) Lack of Agreement Internally
Not being able to develop a clear consensus within your team is another common leasing mistake. This can refer to lacking agreement in terms of direction, objectives, or simply deciding on a final office space.
16) Not Having Clearly Defined Objectives
When you don’t set objectives for your business, you can’t measure how well an office lines up with your business. You shouldn’t make your business fit the real estate, it already should.
17) Lacking Competition
When you don’t have other options available to you, you’re competing for an office instead of having a landlord compete for your business. This particularly crucial when exploring a renewal.
18) Not Taking Pictures Prior to Moving In
Take pictures before signing the lease to document any damage. This can help you negotiate a better deal and allows you to get repairs made before you move in.
19) Not Ensuring that Your Needs are Met
When you sign a lease, your primary concerns should already be addressed. Having adequate representation can prevent you from signing a lease that you “thought” covered all your needs.
20) Neglecting to Find the Appropriate Representation
Proper representation offers numerous benefits for tenants. They’ll receive guidance and instruction in every step of the process, and they have your best interest in mind. They understand a tenant’s needs and know how they can help you meet those needs.
If you’re currently looking for tenant representation, our team can help you in this endeavor. Our brokers have an unparalleled knowledge of the market and we understand the importance of quality representation. To experience it first-hand, contact the Kaufman leasing team.