Securing your first office space marks a major first milestone in the life of a startup. It can be easy to get caught up in the excitement but here are a few things that you should consider before you make your final decision.
1. Know what your office space requirements are
If you begin your search knowing what your needs are, it will ensure the process goes smoothly. In order to define your objectives clearly, you want to list out your plans for future business growth. Do you expect your startup to grow quickly or do you foresee slower, steadier growth for your business? How you answer these questions can make all the difference when it comes to the size of the office you rent and the features available.
Other questions to ask yourself:
· Does your startup need to be located in a particular area?
· What are your transportation requirements?
· What kind of parking requirements do you have?
· How many offices or spaces will you need for the people you have and how many more will you be needing in the foreseeable future?
· What amenities, if any, are important to you? (Think kitchen, break room, conference area, security.)
2. Build your team
You will want to decide on one person who will be the point of contact throughout the process.
Bring in a real estate broker who specializes in representing tenants. If they have experience with startups, that will be even better. A good broker can help you navigate the process while pointing out helpful things. Be sure to let them in on all of your requirements. They will be able to steer you toward the right properties and more importantly, keep you away from the office spaces that could be problematic for you.
A talented real estate attorney can ensure that you negotiate enough flexibility into your lease so that you don't end up being shackled to an office space that is no longer suitable. You also want to make sure that all of the terms and conditions in your lease are fair and will protect you in the event any unexpected problems arise later on.
3. The search for the perfect space
Give yourself at least one month to find a suitable location. In that time you should expect to be viewing new spaces and constantly searching. It can take some time. You can be proactive in your search by going online and using services like Gumtree. They feature a variety of real estate listings to suit every need.
4. Have your references ready and finances in order
Most landlords that you will find are going to want to rent to only the most financially secure tenants possible. In this way, they lessen their risk. But, of course, that means that you will need to provide rock solid references and proof that your financials are secure. You may be required to show tax returns, bank statements, as well as putting down a security deposit.
It is not unusual for landlords to ask for leases that are at least five to seven years long. If you can negotiate a shorter lease, perhaps three years, that will give you more flexibility down the road when your startup hits a growth period and you need to consider larger spaces.
Another possibility to consider is subleasing your first office space. You can often find properties at rates that are below the current market value. While you likely won't be allowed to make any improvements to the property and your options for renewing the lease may be limited, your financial liability will be lessened considerably.
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