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) September 1, 2019

from Twitter https://twitter.com/AustinTenantAdv

Flavius Aetius thanks for following me on Twitter! https://t.co/mmo6ftiRp2

Flavius Aetius thanks for following me on Twitter! https://t.co/mmo6ftiRp2

— Nathan K Smith (@AustinTenantAdv) September 1, 2019

from Twitter https://twitter.com/AustinTenantAdv

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) August 31, 2019

from Twitter https://twitter.com/AustinTenantAdv

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) August 30, 2019

from Twitter https://twitter.com/AustinTenantAdv

Are Commercial Lease Rates Negotiable?

It depends.

In most cases commercial listing agents will typically quote a rate that is a little bit higher than what the landlord is willing to take. At the end of the day it doesn’t hurt to offer less, however if you low ball they won’t take you seriously. It’s also important that you understand what market conditions are and what the landlords motivation is.

For example If the landlord is trying to sell the commercial building they most likely will want to keep the rates as high as possible as the monthly rents paid by tenants will dictate the market value of the building. Lower lease rates reduce the NOI of the building. Find out if the building is currently for sale. If it is then you know to focus on other concessions like rent abatement.

Also, In a hot market where landlords have a lot of interested parties they may be less likely to negotiate on the lease rate. If you really want to lease the space you may not have a choice but to pay the quoted rates.

Don’t just focus on commercial lease rates. Too many tenants make this mistake. Just because you got a lease rate that is lower than what they were quoting does not mean you got a good deal. There are a lot of other concessions to be had in commercial lease negotiations.

 

 

 

 

Commercial Vs Residential Real Estate – What is the Difference?

If you are getting your real estate license and not sure if you want to have a career in commercial real estate vs residential real estate then you will want to read this post. There is a difference between the two and it’s important that you be aware of them. 

Below we will touch on some of the main differences of commercial vs residential real estate however keep in mind there are many more.

Education

In Texas anyone that wants to represent buyers, sellers, tenants, landlords, and tenants whether commercial or residential has to get a real estate license. The basic education requirements for this are the same for both.

The core curriculum of the Texas real estate license weighs heavily on the residential aspects of real estate. If you want to get more commercial real estate education you will have to pay for 3rd party courses through CCIM or others………..and good ole on the job training. Finding a good mentor is key.

Also there are many types of commercial real estate to learn and the nuances of each are different. 

Having a college degree may help you get your foot in the door with some commercial real estate brokerages however it’s not necessary. Some will say that you have to have a college degree to be a commercial real estate agent however I know plenty of commercial brokers that don’t have degrees. However if you want to increase your chances of being hired by a big commercial real estate firm then get a college degree.

Type of Clients You Deal With

In residential you are mainly working Business to Consumer (B2C) with individual consumers who want to buy, sell, or rent homes as your main point of contact. 

In commercial real estate you are working Business to Business (B2B) with your main contacts being business owners, CEO’s, CFO’s, COO’s, Operations Managers, and in many cases office managers and/or administrative assistants.

If you don’t like cold calling businesses then you might stick with residential.

How Long Deals Take

The sales cycle is much longer in commercial real estate.

In residential once you find a house you like, make an offer that gets accepted, you will typically close in 30 days or less. Also depending on the market you are in you only get 3-7 days for due diligence to complete and review the inspection report and get pricing on any repairs needed.

Depending on the type and size of space, market, scope of work needed, zoning requirements, etc., commercial real estate transactions can take anywhere from 30 days to 12 months or longer. In most cases the minimum due diligence time frame is 30-45 days. A more complex transaction could require many months of due diligence

Ramp Up Time to Start Making Money

In residential you typically get paid commissions at closing. Because of the shorter sales cycle you are able to make money more quickly.

Because the sales cycle is longer in commercial real estate it will take you much longer to make money than in residential. In commercial leasing you typically get paid half of the commissions within 30-60 days of lease signing and the other half when the tenant moves in. If buying commercial you would get paid at closing however keep in mind how long the deal takes to close from start to finish. I’m not saying it’s not possible to make money sooner in commercial however in most cases it’s a good idea to at least have 6-12 months of living expenses set aside. If you are a quick learner and diligent about prospecting you have a better chance of making money sooner.

Work Hours

Commercial real estate agents mostly work during business hours. Yes there maybe times where you work after hours or on weekends………however most work is typically done during the business week days.

This is because you are working with businesses.

Residential agents work with consumers who may not be available to see houses until after work or on weekends. So if you don’t want to work a lot of evenings and weekends then residential real estate is not right for you.

How Much You Can Make

You will hear people say you can make more money in commercial real estate than in residential. I don’t think that is totally true as I know people who do very well in residential.

I think selling residential properties is easier than commercial however regardless of which you choose you still have to prospect and generate leads. No leads, no sales or leases. 

Most people are lazy. If you work hard every day to continuously learn your craft and are constantly networking, cold calling, prospecting, and work in real estate FULL time, you will do well.

To make good money in real estate as a broker or agent you have to be in and around the business FULL time. You will not make good money being a part time agent.

Conclusion

Above we have only touched on some of the main differences of commercial vs residential real estate. 

Commercial real estate transactions can be more complex and take longer to close from beginning to end, which means it takes longer to make money.

However you have to decide for yourself which is the best route. Becoming a commercial real estate agent does not mean you will make more money. No matter which you choose you can make good money…………ONLY if you work hard at it!

 

 

 

 

 

 

 

 

1,233 SF Short Term Office Sublease For Rent in Northwest Austin

If you are a startup or newer company that needs the flexibility of a short term office lease then you might want to check out this 1,233 sf office sublease in Northwest Austin.

In the Northwest Austin metro the office market is very tight and most landlords won’t do any leases less than 3-5 years. This sublease only has 21 months of term left so this is perfect for companies that are just getting started and not ready to commit to long term contracts.

This space is move in ready and all utilities are included in the rate. If you need to lease office space in Austin and need a short term lease give us a call at 512-861-0525

Details of This Northwest Austin Office Space Sublease

Size: 1,233 Sf

Layout: Reception, 5 offices, open area for desk, wet bar

Building Name: Synergy Plaza South is a 3 story professional building with common are lobby and bathrooms

Address: 11940 Jollyville Rd, Suite 320-S, Austin Tx 78759

Rental Rate: $29 sf gross (this includes electric and janitorial)

Sublease Expiration Date: May 31st, 2021

Floor Plan for Suite 320-S at 11940 Jollyville Rd

Contact Us About This Northwest Austin Office Space Sublease

For more details about this NW Austin office space sublease call Nathan K Smith at 512-861-0525

If you need to rent Austin office space in other areas let us know and we can help you find the perfect space at no cost to you.

7000 North Mopac Expressway – Plaza 7000 Office Rental Guide

Plaza 7000 is a Class A Office Building located in Northwest Austin at the corner of Far West Blvd and Mopac. If you are looking for nice office space with convenient access to major highways, hotels, shopping areas, and restaurants this is worth checking out. It’s great for small to medium size businesses.

Building Information

• Total Rentable Square Feet – 155, 076
• Number of Stories – 4
• Typical Floor Size – 40,629

Parking

The parking ratio is 4 / 1000 sf. There are 285 free covered spaces available

Building Amenities

• Onsite deli
• Fitness Center
• Building Conference Rooms

Location

The address is 7000 N Mopac Expressway, Austin, Tx 78731. Located at the corner of Far West Boulevard & Mopac Exp.

Transportation Information

• 30 minutes to the Austin Bergstrom International Airport
• 20 minutes to downtown Austin
• 10 minutes to the Domain & Arboretum

Cost to Lease Office Space at 7000 N Mopac

Current quoted lease rates are $30 + $15.05 nnn. What that means is if you leased 4,000 sf your monthly rent would be $15,000 per month (4,000 sf X $45.05 sf / 12)

Available Office Space

Interested in leasing office space at Plaza 7000 in Austin? Give us a call at 512-861-0525. If they don’t have what you are looking for there we can help you locate other class a office spaces in NW Austin.

What is a Gross Lease in Commercial Real Estate?

A gross lease is a type of commercial lease in which the tenant pays a flat rental fee. The rent paid is inclusive of all operating expenses such as taxes, insurance, common area maintenance charges, janitorial services, and utilities…. which are paid for by the landlord.

Not all commercial properties are managed the same way so be sure to ask all the right questions to be sure of what rent and operating expenses you are responsible for……….and get everything in writing! 

Benefits of a Full Service Gross Lease

• Less complex for tenants to understand than other types of commercial lease rates
• Landlord is responsible for any increases in operating expenses
• Easy for tenant to for forecast expenses
• Eliminates any worry about unexpected building costs

Disadvantages of a Gross Lease

• Tenants pay the same rent regardless if the operating costs are reduced for whatever reason

Definition of Gross Lease

Above we have defined the basics of a gross lease in a commercial real estate transaction. Depending on the market, type of space, and landlord commercial properties are managed differently. When negotiating a commercial lease be sure to ask if janitorial and utilities are included. Also confirm if it’s a true gross lease or one that incorporates a “base year”.

Also be aware that as commercial lease operating expenses become more unpredictable (mainly taxes) landlords are changing to triple net (NNN) leases rather than gross leases. This makes it easier for them as they are able to pass along 100% of the costs associated with managing commercial properties. Whether you leasing office space, retail space, or warehouse space most will be NNN leases.

Brashears Miller, PLLC thanks for following me on Twitter! https://t.co/BqqULU27jU

Brashears Miller, PLLC thanks for following me on Twitter! https://t.co/BqqULU27jU

— Nathan K Smith (@AustinTenantAdv) August 13, 2019

from Twitter https://twitter.com/AustinTenantAdv

Traditional Office Space VS Coworking: Which is More Expensive?

It depends on the market you are in and the number of employees your company has, however in general if your company has more than 5 employees it’s typically about 20% to 30% more expensive to lease coworking space.

At the end of the day you have to evaluate the total cost of leasing office space as it’s more than just lease rates. You also have to evaluate the value of flexibility, amenities, and day to day operations.

Why is Coworking Space More Expensive?

Coworking providers like WeWork rent space directly from building owners (aka landlords) typically for 5-10 year lease terms. Even though they negotiate and receive a tenant improvement allowance they still significantly come out of pocket to complete the build-out and furnishing of their spaces. In addition they have full time staff on duty for day to day operations. To recoup their investment AND to make a profit they typically charge on average 20% to 40% above the rents that they pay to the landlord. 

Should I Rent Traditional Office Space or Coworking Space?

If you are unsure about the future of your company whether it will experience rapid growth or be able to survive the next 12-24 months then you should stick with coworking. If you only have 5-10 employees then coworking might be the least expensive alternative.

However if your company is stable or growing and you have more than 10 employees then renting traditional office space will probably be better suited for your needs.

Small 1,276 SF Short Term Office Space Sublease Bee Cave Tx

If you are a startup or newer company that needs the flexibility of a short term office lease then you might want to check out this 1,276 sf office sublease in bee cave Tx.

In the Austin metro the office market is very tight and most landlords won’t do any leases less than 3-5 years. This sublease only has 9 months of term left so this is perfect for companies that are just getting started and not ready to commit to long term contracts.

This space is move in ready and all utilities are included in the rate. If you need to lease office space in Bee Cave tx and need a short term lease give us a call at 512-861-0525

Details of This Bee Cave Tx Office Space Sublease

Size: 1,276 Sf

Layout: Reception, 5 offices, wet bar

Building Name: Villa di Calabria Office Park is a 3 story professional building with common are lobby and bathrooms

Address: 11719 Bee Caves Rd, Austin Tx 78738

Rental Rate: $27 sf gross (this includes electric and janitorial)

Sublease Expiration Date: May 31st, 2020

Contact Us About This Bee Cave Office Space Sublease

For more details about this Bee Cave office space sublease call Nathan K Smith at 512-861-0525

Floor Plan for Suite 101 at 11719 Bee Caves Rd

If you need to lease Austin office space in other areas let us know and we can help you find the perfect space at no cost to you.

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) August 5, 2019

from Twitter https://twitter.com/AustinTenantAdv

Things To Consider Before Leasing Commercial Property

Leasing commercial property is much different than renting an apartment. A commercial lease contract is a complex document that is negotiable however typically heavily favors the landlord. There is a lot more to leasing commercial space than just finding a space. You have to know what you are doing to ensure success. If you don’t then hire someone that can level the playing field against the landlord and Landlords’s agent.

Below are a few things to consider before leasing commercial property.

Get your financials in order

Landlords are going to ask to see your financials when leasing commercial space so please don’t get offended when they do. It’s part of doing business. Before they agree to give concessions like tenant improvements they want to make sure you are financially stable. Many will ask to see these BEFORE they respond to your proposal or offer.

Ask the Landlord a Lot of Questions

It’s important that you understand who owns the building, who does the leasing, who the property manager is, etc… Here is a list of questions to ask commercial landlords or listing agent when touring commercial properties.

Ask Yourself the Right Questions

You need to understand your current and future needs so here are a few questions to ask yourself before leasing commercial property. For example How much space do you need now and within 12-24 months? Do you need room to expand? What is the maximum you can afford each month? What is the longest lease term you can sign? Don’t let the landlord talk you into to paying more than you can afford or signing a lease longer than makes sense for your business.

Get to Know the Lingo

As you talk to commercial real estate agents they are going to throw out a lot of commercial real estate terms and definitions. You need to be familiar with these so you can negotiate effectively and not make mistakes

Understand the Types of Commercial Leases

Some commercial properties are referred to as NNN leases, Gross, Modified Gross, etc. Do you know what this means? If not check out our post that talks about the different types of commercial leases.

How Long of a Commercial Lease Term Makes Sense?

The length of lease term in a commercial lease typically depends on the market you are in, the existing condition of the space, and the landlords preference. Landlords want you to sign as long of a lease as possible. If you are a new business then try to get a shorter term lease (less than 2 years). If you are a stable business then a 3-5 year lease makes sense. The longer the lease the more concessions you will be able to receive. The more improvements needed on a space the longer lease term the landlord will require so they can recoup their initial costs. At the end of the day you need to understand your current and future needs and agree to a lease term that makes business sense.