Flavius Aetius thanks for following me on Twitter! https://t.co/mmo6ft1gxu

Flavius Aetius thanks for following me on Twitter! https://t.co/mmo6ft1gxu

— Nathan K Smith (@AustinTenantAdv) May 31, 2019

from Twitter https://twitter.com/AustinTenantAdv

Josh Daspit thanks for following me on Twitter! https://t.co/Qoncn6tern

Josh Daspit thanks for following me on Twitter! https://t.co/Qoncn6tern

— Nathan K Smith (@AustinTenantAdv) May 26, 2019

from Twitter https://twitter.com/AustinTenantAdv

Nate Bjorklund - Commercial Real Estate thanks for following me on Twitter! https://t.co/KYMkk6ZYGh

Nate Bjorklund - Commercial Real Estate thanks for following me on Twitter! https://t.co/KYMkk6ZYGh

— Nathan K Smith (@AustinTenantAdv) May 25, 2019

from Twitter https://twitter.com/AustinTenantAdv

The Kelemen Company thanks for following me on Twitter! https://t.co/JZ3HBzY54X

The Kelemen Company thanks for following me on Twitter! https://t.co/JZ3HBzY54X

— Nathan K Smith (@AustinTenantAdv) May 24, 2019

from Twitter https://twitter.com/AustinTenantAdv

Nate Bjorklund - Commercial Real Estate thanks for following me on Twitter! https://t.co/KYMkk6ZYGh

Nate Bjorklund - Commercial Real Estate thanks for following me on Twitter! https://t.co/KYMkk6ZYGh

— Nathan K Smith (@AustinTenantAdv) May 24, 2019

from Twitter https://twitter.com/AustinTenantAdv

Josh Daspit thanks for following me on Twitter! https://t.co/Qoncn6tern

Josh Daspit thanks for following me on Twitter! https://t.co/Qoncn6tern

— Nathan K Smith (@AustinTenantAdv) May 24, 2019

from Twitter https://twitter.com/AustinTenantAdv

What is Creative Office Space & Why Companies Want it

Gone are the days when businesses simply wanted to lease traditional office space complete with a reception area, private offices, boring cubicles, walls painted white, standard broad loom carpet, 9 foot ceilings, etc. These days leasing creative office space is the hot topic among software and technology companies. Everybody asks for it and wants it. But what is the definition of creative office space?

Creative Office Space Defined

• Offices or warehouses converted to office space constructed with high exposed ceilings & open floor plans with a few offices and conference rooms.
• Design features such as:
  • concrete or carpet tiled floors,
  • multipurpose rooms with movable walls,
  • colorful wall coverings and other such as red brick, sheet metal, or reclaimed wood,
  • exposed air conditioning ducts,
  • Natural & Led lighting,
  • modern furniture such as standing desks and workstations 
• Wellness amenities such as fitness centers, yoga, bike storage, outdoor spaces, pet friendly
• More expensive than traditional office space

Reasons Why Companies Want Creative Office Space

• Create a welcoming environment and “Wow Factor” for visitors 
• Promote a creative, collaborative, and spontaneous environment
• Retain and attract top talent
• Optimize space usage by having multipurpose rooms
• Enhance company culture and employee mental health
• Space that nourishes employees not drain them
• Encourage social interaction, communication, and engagement among employees
• Allows flexibility of where employees sit and how they work.

Flavius Aetius thanks for following me on Twitter! https://t.co/mmo6ft1gxu

Flavius Aetius thanks for following me on Twitter! https://t.co/mmo6ft1gxu

— Nathan K Smith (@AustinTenantAdv) May 22, 2019

from Twitter https://twitter.com/AustinTenantAdv

What Should I Look For When Renting Office Space?

Renting office space is a big decision whether you are a new business or startup or an established existing business. You don’t want to choose just any office. You need to make sure that the office space you lease meets your current and future needs. You don’t want to just settle on anything. In most cases you will end up signing a 3-5 year lease so it’s important that you pick the right one from the get go.

Below are some things to look for as you tour properties.

Make Sure It Meets Your Timing

You need to make sure it meets your timing. If you have to be moved in within 30-60 days then you should focus only on offices that are 2nd generation…meaning they have been built out and occupied before. Only consider properties that need minimal improvements (think carpet, paint, and maybe adding or removing a wall or two)

A space that is in shell condition (brand new, never been built out) will take 4-6 months to make ready depending on the size, permitting process in your city, build out, etc. 

Don’t waste time looking at spaces that have an uncertain move in date if you are in a time crunch. 

Consider Locations Near Employees

If you absolutely have to be in a specific area (e.g. Downtown Austin) then do that, however if you don’t pick an office that is close to the majority of employees.

Employees have enough to juggle already (e.g. family, personal, etc.) don’t make their commute times a struggle.

Easy to Find

If you have a lot of visitors make sure the office is easy to find. A hard to find office may be a little less expensive however it’s not worth it. Give your visitors a pleasant experience from the beginning.

Options to Grow

If you are a growing company it’s important that your office be able to accommodate your current and future needs.

Moving sucks. The bigger your company gets the harder it is to move. If a building does not have options to grow into then consider other buildings.

Nearby Amenities

Your employees will appreciate an office that is close to restaurants, dry cleaners, medical offices, etc. They have lives to run to and it’s hard to get things done when there is nothing nearby. 

Lease Term You Can Live With

If you are a startup that is in growth mode then only focus on properties that can accommodate a short term lease 1-3 years. You won’t have the leverage to negotiate many concessions however if flexibility is important than it’s worth giving up other concessions.

If you are more established than it may make more sense to do a longer lease which will give you more leverage in negotiations for lease concessions (e.g larger tenant improvement allowance).

Lease Agreement That Makes Sense

Make sure you understand what the landlord is responsible for and what you (tenant) is responsible for. Make sure you know exactly the dollar amount that you must pay each month and what all is included. Don’t just take the landlords word for it. Get is all in writing and ensure that everything is clearly spelled out. Have your attorney review before signing.

 

Roman Reigns thanks for following me on Twitter! https://t.co/HjLPQFb9Yo

Roman Reigns thanks for following me on Twitter! https://t.co/HjLPQFb9Yo

— Nathan K Smith (@AustinTenantAdv) May 19, 2019

from Twitter https://twitter.com/AustinTenantAdv

What Is Negotiable When Renting Office Space

Renting office space will be one of the largest expenses you have so it’s important that you know what can be negotiated.

You can figure it out on your own however that will take a lot of time away from your business, and market conditions change all the time. What was once negotiable 3-5 years ago may not be now. Trying to figure it out on your own is time consuming. It’s best to just hire a commercial agent to help you find the office & negotiate the lease. Someone whose full time job it is to study and learn the market and negotiate multiple office leases every year. Besides their service doesn’t cost you anything.

To give you an idea what office lease deal points can be negotiated with landlords we have listed a few below.  If you have any questions or would like help renting Austin office space feel free to give us a call.

Things That Are Negotiable When Renting Office Space

• Lease term
• Tenant improvement allowance
• Security deposit
• Base Rent
• Yearly Rent Escalations
• Rent abatement
• Rent commencement date
• Use of the space 
• Operating expense caps
• Expansion options
• Renewal options
• Sublease options
• Right of first offer on vacant space
• Right of first refusal on vacant space
• Landlord construction management fee
• Space planning allowance
• End of lease restoration
• Signage rights
• Parking spaces
• Exclusive use rights in the building
• Personal guarantees
• Termination options
• Repairs & maintenance
• Relocation clauses

These are just a few items that can be negotiated in an office lease. The impact that these have will differ based on the type of business and your current and future business needs. It’s important to understand the impact that each one of the negotiable items above will have on your business NOW and in the future. No matter how great your business is now or how great you think it will be in the future you should always assume worst case scenarios when negotiating office leases.

If you have any questions about what can be negotiated in an office space lease feel free to give us a call to discuss at 512-861-0525

John Tomblin thanks for following me on Twitter! https://t.co/QRoqDXlunG

John Tomblin thanks for following me on Twitter! https://t.co/QRoqDXlunG

— Nathan K Smith (@AustinTenantAdv) May 15, 2019

from Twitter https://twitter.com/AustinTenantAdv

Royal Diamond Media thanks for following me on Twitter! https://t.co/sWUmseSFm9

Royal Diamond Media thanks for following me on Twitter! https://t.co/sWUmseSFm9

— Nathan K Smith (@AustinTenantAdv) May 12, 2019

from Twitter https://twitter.com/AustinTenantAdv

Josh Daspit thanks for following me on Twitter! https://t.co/Qoncn6tern

Josh Daspit thanks for following me on Twitter! https://t.co/Qoncn6tern

— Nathan K Smith (@AustinTenantAdv) May 9, 2019

from Twitter https://twitter.com/AustinTenantAdv