What are your office space needs now and in the future? Before you begin your search for office space, you’ve got to have an idea of what you are looking for: you need to determine what your office space needs are. How much space do you need today? How much will you need in the future?
Check our office space planner article to get an idea of what each use will take in terms of space. For example, you may need a 250-square-foot office for yourself plus a meeting room and reception area to start a business.
Down the road, you may plan to hire employees. Should you take that minimum space now and worry about the rest later on? Or should you contract for all of the space right now if you can get a good deal? Landlords have a lot of space on their hands currently and they may be willing to work with you on a small space right now that can be added to as you grow.
Determine Your Office Space Needs
Once you determine your office space needs, consider possible alternatives that could get you what you need but save you money. For example, one major New York City landlord that we know has set up business center/virtual offices at several of his major buildings in both midtown Manhattan and down on Wall Street. For the new entrepreneur who will start a business, this landlord will furnish him with a virtual or real office (for a fee, of course) at one of his buildings.
The benefit to the entrepreneur is that he does not have to make a major dollar commitment right now. This allows the new start-up the option to hold down costs considerably at the onset and to expand only when necessary. Unless you are independently wealthy, you owe it to yourself and your business to always conserve cash where you can but spend it where you have to.
Plan for the Future
For example, a new start-up can get a Wall Street or midtown address in a prominent building through the virtual office arrangement. The entrepreneur can print up his letterhead, business cards and sales brochures with that address. He is also furnished with a big city telephone number and a live receptionist to answer his phone in his company name. The landlord hopes that once this business begins to grow that the new start-up will lease considerable office space in that building where the business is set up. Meanwhile, the entrepreneur can contain all controllable costs to increase his odds of making a go of the business.
Typical of how this works… Several financial people who worked for top firms on Wall Street were laid off near the end of 2008 as the Wall Street financial crisis turned into a debacle, created a virtual office at one of the building owner’s Wall Street locations that satisfied their office space needs and helped them conserve cash. Each partner in this new firm actually worked out of their home office. When they need to meet with clients, they rent an office or meeting room at the building location where they have the virtual office. This is the definition of the smart use of available resources. Thanks to their client-stocked Rolodexes, they are quickly picking off clients once the exclusive purview of the big Wall Street investment bankers and plan to lease considerable office space in the near future from this landlord. Meanwhile, the office expenses are only a few hundred a month.
Get Creative
You too need to look at creative options on space, especially space you are “hoping” to need in the future. If you sign a five- or seven-year lease on space that includes space you do not need right now, you can get saddled with vacant space for the entire term of your lease. We know a Minneapolis consultant who moved in the boom years of the early 2000s and leased 10,000 square feet of space, even though at most, he needed 2,500 square feet. To this day he is still sitting there with a huge “storage” area and paying office rent on all of it.
A smart Dallas, Texas publish took only the space he needed and was warned by the landlord’s broker that if he did not take the extra space next to his offices, it might not be able when he needed it. He said to the broker, “why do I need contiguous space in the building?” When his office space needs called for more space, he set up another office on another floor.