Your company signed a lease for office or perhaps warehouse space a few years ago and you’re now somewhere in the middle of the term. You can relax for a few more years, right? Wrong. Not if you want to make sure that you are staying ahead of the game. Here are three things that you should do right now:
- Know the Market – Where are market terms relative to your current rate and terms? Find out availability and current rates for both your existing building and competitive alternate spaces.
- Why this Matters: You want to be proactive and informed should you need to either expand or contract. You might discover the opportunity to renegotiate now for either more or less space, or otherwise improve your terms as an early incentive from the Landlord for you to renew. And you won’t be surprised when lease renewal or relocation time comes along.
- Audit your Current Lease – Are your negotiated Operating Expense exclusions or caps on increases being correctly calculated? Are you paying the correct proportionate share of expenses? Your lease is likely a complex 40 pages or more and there is not a word there by mistake – it is all there to protect the Landlord.
- Why this Matters: Don’t rely on the Landlord’s bookkeeper to apply your negotiated terms or assure that you are not being overcharged. Now is also the time to consider how your terms compare to current market terms.
- Reassess your Requirements – Is your space as efficient as it could be? Know how your neighbors and industry peers compare and are building out their space. See how strategies like hoteling or coworking layouts might work for you.
- Why this Matters: You need to understand how much you might save or better serve your objectives with an ideal layout. Most companies use space differently now that they did 5 years ago. Attracting workers and leveraging their talents often requires more collaboration, requires less admin, filing, and library area, and replaces drywall with glass partitions to allow more light. Now is the time to start considering how your space could be better used in the future and start discussing with your staff.
Avoid negative surprises at the end of your lease, or discover that you’ve been incorrectly charged for years when it might be more difficult to correct or collect.
You don’t wait until you are ill to go to the doctor for a checkup (hopefully). Don’t wait until your lease expiration is upon you to do a Lease Checkup. Stay informed and on top of market terms.