5 Important Things to Remember Before Leasing an Office Space For Your Startup
Setting up a business requires a place for transactions. Yes, it could be easy to find an office because of the abundance of commercial spaces in Metro Manila; however, finding the perfect match for your business is another challenge.
Here are 5 important things you need to remember before leasing an office space:
You need to know how much space your business needs. Consider the number of employees, tables, and equipment and if they would all fit inside your prospect office. Be mindful of the structure of the office because it would also affect the positioning of the furniture pieces. It is better if you would opt for a regular-shaped commercial space.
Terms simply mean the lease agreement which includes duration. The start and end date of the contract should be clear to you, as well as your options for renewal or contract termination. Ask for flexibility if possible. Long term lease is preferable to already established companies. If you’re just starting, it’s advisable to take shorter terms with different options for renewal. As your business grows, the need to adapt to changes will become inevitable. Give your company enough time to settle down, but leave room for adjustments.
Be sure to understand entirely what are included in the bill. A fixed rent inclusive of dues and fees is not unusual. But, you should really know what you are paying for. Familiarize yourself with the calculations and the determining factors for possible rent escalation. You can protect your business’ interest through negotiating a cap or ceiling price. Possibly, you’re in better odds when on a longer lease term.
A leased office space is just like a borrowed item. You are entitled to use it, but not to abuse it. Know what is permitted in the premises before deciding to lease it. Know the limitations because of course, you’ll be drilling a few holes and installing a few lights to better suit your business needs. You do not own the space. Make sure that when you afford it with expensive fixtures it is perfectly fine with you if you won’t be able to take some with you when you end your contract with the owner. Property managers may require the property to be reverted back to the original condition. In this case, you can negotiate normal wear and tear policy especially to damages that are beyond your control. Be certain as well about maintenance and repair costs as to who will cover them.
Some clauses in the lease may appear too confusing even to experienced businessmen. Watch out for fine prints that can be disagreeable to your interests. Take time to review the lease with your broker, property manager, or real estate attorney in details. Don’t get too carried away with cheap rent or location.
It is important that you ask questions and provide suggestions before signing the lease contract so you won’t worry about being involved in a possible legal turmoil in the future.
This article is contributed by Monaliza de Castro, a Hoppler broker.