Many business owners soon discover that sharing office space or working out of a room in someone’s home is no longer ideal. When a business starts to grow and develop, it’s going to need more room, and the time may come for the owners to start renting business premises.
But how do you find the right premises for you? Below you will find some tips that can help you make that move a little easier:
Be Prepared to Pay Rent Months in Advance
Some landlords may insist that you pay as much as 6 month’s worth of rent in advance along with a deposit. Deposits can cover VAT and you may not be able to claim the VAT back right away. If you opt for a 10-year lease your landlord may wish to review the rent in the 5th year. This review may include a rent increase or simply determine whether you would like to continue renting the building or office in its current condition.
When the Building Needs Some Attention
If you find that the premises you’re being offered are not up to scratch you could negotiate the rent. The best thing you can do here is hire a local solicitor that deals with commercial property as they may be able to get you a rent-free period. Make sure that your lease does not leave you liable to leave the office or building in a better state than you found it.
You may also want to make sure that you check out the heating, security issues like having an access control system installed or a guard, electrical appliances, and any other services that come with the property.
Once you do find somewhere, keep in mind that you will be responsible for its upkeep and maintenance. It’s well worth having a few useful numbers stored somewhere for companies like Total System Services (should your HVAC system stop working and need a professional to see to it), as well as a plumber, electrician, etc.
Changing the Layout
Many landlords are happy for you to make any non-structural changes to their premises. However, you should be aware that at the end of your tenancy/lease you will need to hand the premises back in the condition you found it in. If you have made structural changes without your landlord’s explicit permission you may have to pay to change things back again.
Consider How Long you Want to be There
Is there a chance that you may need to move to larger premises in the future? You need to negotiate your lease’s terms so you can move elsewhere if needed. To evaluate your financial expenses while leasing the office premises and other necessities like a warehouse, office gadgets or vehicles, etc., you can employ lease accounting software. Such applications could be customized to support your company’s requirements, and the data can be exported to your business ERP system. It can be an efficient method of monitoring leased capital and assets so that you can terminate your contract or negotiate when you encounter financial issues.
Create an Exit Plan
If you need to terminate your lease it could be beneficial if you already have an exit plan. You should have notice periods that have been agreed by you and the landlord so you do not need to pay any penalties. If you sign a short-term lease your landlord may insist there’s an ‘outside the act’ clause. This clause means the lease will not automatically be renewed after 10 years.
Renting your first office can be exciting, it can give your business all the room in needs, but the rental process can be hard work. Make sure you know exactly what you need, how much rent you have to pay in advance and what your exit plan is. The more informed you are before you rent a property the more likely you are to make the right decision for you and your business.