Short-term office lease agreement: The latest trend
One of the scariest things when looking for office space is the office lease agreement. Today's economy makes it really hard to commit to a long-term agreement because companies are constantly facing changes. If you are about to sign an agreement for an office that implies you have to stay in that space for the next 10 years, consider this period is too long for you to know what changes will occur in your company.
That is what makes business centers so relevant. They offer short-term agreements with flexible characteristics that will allow you to make any changes depending on how your company evolves, without worrying about breaking the lease. Executive suites grow with you and your company, and so will the lease agreement.
Additionally, once you sign the lease you can immediately move to your new office, and there's no need to take care of furniture, internet, phone connections or coffee because everything is included.
With this article we want you to have full control of your workspace and familiarize with some of the terms that may appear during the negotiation.
Is the predetermined amount of rent the tenant must pay, quoted on a square foot per year basis. For example, if you're renting an office with 500sf at a base rent of $20/sf you will be paying $10,000 a year in base rent.
Rentable Square Feet vs. Usable Square Feet
Usable Square Feet is the actual square footage that you are using within your four walls to operate your business. The Rentable Square Feet adds a pro-rate of the common spaces you share in the building like the lobby, corridors, common bathrooms, and so on.
To calculate how much of the common areas should be included in a tenant’s rentable square feet, the landlord finds the load factor of the building. This is calculated by taking the building’s total rentable square feet and dividing it by the building’s usable square feet.
If you're planning to make any changes to your office, that is when negotiating a tenant improvement allowance can come into play.
Tenant improvements, also know as TI are a predetermined construction allowance given by the landlord to the tenant. This can be something as simple as painting the walls or creating divisions within the office to create private suites. Make sure youtalk about this aspect if you want to make any improvements to your newly-leased space.
Sublease & Termination Options
Even though the short-term lease agreements find in business centers are often based on a month-to-month rental agreement (meaning your lease is automatically renewed each month, and you have the flexibility to cancel it with only a 30-day notice) there isalways the possibility you need to leave the location before the lease expires. We recommend asking the manager if there are any requirements for terminating the lease in the initial request of the proposal.
Gross (Full Service) Lease
In this type of lease, the rent is all-inclusive. This means everything from IT help, a staffed front desk, and cleaning services will be in your monthly payment. This allows the tenant to have a fixed monthly payment that does not vary based on repairs and maintenance.
We have a match for you
Our priority is to make sure your company finds a workplace that best matches your team, and that definitely includes a fair and favorable office lease agreement.
If you want to start looking today, search through in our listings in Atlanta, San Francisco or Washington D.C. They all have various options with different types of agreements that vary according to your needs.