How Much Office Space is Enough?
In his week’s blog, we present an article written by Todd Stevens with Cresa that was featured in BizJournals.com. It explores how much office space is really needed for your company and provides some information on the blueprint we can help you work through as you examine your office space footprint. Cresa is one of the world's only global commercial real estate advisory firm that exclusively represents occupiers and specializes in the delivery of fully integrated real estate solutions. Cresa's services include transaction management, workplace solutions, project management, consulting, lease administration, technology, investment banking and capital markets and portfolio solutions.
If you would like to start a conversation on how I can help
you evaluate your office space, let’s start a conversation. You can contact me directly at www.tenant-broker.com.
A remote workforce is the new norm –
how much office space do you really need?
Todd Stevens – Cresa
Nov 9, 2021
The pandemic has forced many businesses to adopt new methods
of work. Virtual meetings and remote work, while not entirely new, have become
commonplace and most people would agree are here to stay. The Zoom fatigue that
so many of us were feeling a year ago when every meeting was virtual has been
replaced with video conference technology, now seen as a tool to work more
efficiently. And the ability to work from somewhere other than your office
while still staying connected has caused many executives to reevaluate their
space utilization. They can now shed what is no longer needed or used.
Though the rate of reduction may vary, most companies can
thrive in less space. But how much space can you save by incorporating remote
work into your long-term workplace strategy? There is no one-size-fits-all
approach; the answer varies from business to business and even from department
to department in larger organizations.
1. Classify employees by work schedules (agile, anchored, or
full-time remote).
2. Understand support and shared-space utilization to ensure
the right types and quantities of non-desk spaces are planned for.
3. Determine the ideal ratio of anchored and flexible
workspaces.
With a clear understanding of what you need, the next step
is finding opportunities in the market that fit your work model while still
supporting employees with the space they need. And as more companies have begun
to incorporate these space efficiencies and ultimately lease less space,
building vacancies are forcing landlords to assume more risk and become more
willing to negotiate with tenants. In short, tenant leverage is increasing.
Whether you are renegotiating an existing lease or looking for new space, the time is now to address your real estate strategy. In concert with your business’s goals, amongst others, we will help you consider the following points of negotiation:
- Abandonment – Reserve the right to work where you want, when you want.
- Audit rights – Landlord mistakes are unintentional, but inevitable.
- Force majeure – Rent protection from the unknown.
- Holdover – Planning for the unexpected.
- Lease length – Is shorter really better?
- Notice provisions – Secure communication timelines that meet your needs.
- Operating expenses – Ensure you get what you pay for.
- Renewal options – Renew all or part of your space with less notice.
- Rental rate – Leverage market conditions for a more favorable rent structure.
- Rent abatement – Delay the start of rent, offsetting costs.
- Security deposit – Use your cash to support your business.
- Subleasing and recapture rights – Use your space your way.
- Tenant Improvement allowance – Reduce exposure by limiting capital expenses.
- Termination rights – Only you should decide how long your space works for you.
- Landlord default – Protect yourself from overleveraged landlords.
An upcoming opportunity to renew your current lease or
relocate and downsize is likely in your future. Regardless of which decision
you make, you’ll want to start the process early. In fact, the earlier you
begin, the more likely you’ll make a sound decision that resonates across your
organization. Site selection and lease negotiation are time-consuming and
critical, and you’ll want to work with representatives who understand the
market landscape and can perform lease reviews and audits that ensure
fair-market terms.
End of Article
If you have significant questions about your current real estate strategy, it may be time for a discussion. Once we have started our conversation, we can create a strategy to look at your business operations and current space and then craft up a plan to find something that is a great fit in the area. With the current vacancies and inventory, we will work with you to get the best deal. We represent tenants ONLY, so you can feel comfortable that we are working for your business 100%. If we can help you by being your tenant broker in the DC, Maryland, or Northern Virginia area, visit my website or call me at 301-841-6542. Make sure to follow all my social efforts by clicking on the links below.
I specialize in providing comprehensive real estate services,
exclusively representing corporate tenants on all commercial real estate needs.
Commercial Tenant Broker
2 Bethesda Metro Center, Suite 900
Bethesda, MD 20814
301-842-6542
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