Mike Delgado 🤗❤️📊 thanks for following me on Twitter! https://t.co/LLNmhA22g1

Mike Delgado 🤗❤️📊 thanks for following me on Twitter! https://t.co/LLNmhA22g1

— Nathan K Smith (@AustinTenantAdv) April 6, 2018

from Twitter https://twitter.com/AustinTenantAdv

Keili Raven thanks for following me on Twitter! https://t.co/JG1zLATKpB

Keili Raven thanks for following me on Twitter! https://t.co/JG1zLATKpB

— Nathan K Smith (@AustinTenantAdv) April 5, 2018

from Twitter https://twitter.com/AustinTenantAdv

Right of First Offer When Leasing Commercial Real Estate

The following post is copyrighted by Austin Tenant Advisors - .

When leasing commercial real estate for a rapidly growing company it’s important that you negotiate to have options to expand, otherwise if you run out of space in that building your only option is to relocate your company to a different building. One of those options is called a Right of First Offer (ROFO).

What is a Right of First Offer?

If you have negotiated a ROFO then anytime a space becomes available the landlord has to “offer” it to you first. This gives you the ability to take the space or reject it before the landlord offers the space to anyone else. A ROFO could include only adjacent space, any space on your existing floor, or any space in the building.

How Does A Right of First Offer Work?

Let’s say you negotiated a commercial lease and the landlord conceded and gave you a ROFO. Then 6 months later a tenant who occupied space on the 5th floor moves out of the building. If you have a ROFO on that space or the 5th floor then the landlord has to offer you the space before offering it to anyone else. ROFO’s can be negotiated for a particular floor or space. The key is to understand your current and future space needs and do your best to negotiate rights to space so you have other expansion options other than having to relocate your business elsewhere.

Example of a Right of First Offer in a Commercial Lease

Landlord shall, prior to offering any of the space on the 2nd floor of the Building containing 31,211 rentable square feet and described as the “Offer Space” on Exhibit A (the “Offer Space”) to any party (including the then-current tenant or occupant therein), first offer to lease to Tenant the Offer Space in an “AS IS” condition; such offer shall (a) be in writing, (b) subject to the immediately following sentence, specify the part of the Offer Space being offered to Tenant hereunder (the “Designated Offer Space”), and (c) specify the lease terms for the Designated Offer Space, including the rent to be paid for the Designated Offer Space and the date on which the Designated Offer Space shall be included in the Premises (the “Offer Notice”). Landlord shall only be required to offer, and Tenant may only request to lease, one of the following three options: (a) the entire 2nd floor (31,211 rentable square feet); (b) 24,233 rentable square feet, depicted in Exhibit A as the “DHI Mortgage” space, or (c) 6,978 rentable square feet, depicted in Exhibit A as “Vacant”. However, if Landlord leases any portion of the 2nd floor, the options contained in the previous sentence shall be revised to be the unleased portion of the relevant space, e.g., if Landlord leases 10,000 of the 24,233 rentable square feet in clause (b), then clause (b) shall be deemed to include only the 14,233 rentable square feet remaining in that section of space. The Offer Notice shall be substantially similar to the Offer Notice attached to this Exhibit. Tenant shall notify Landlord in writing whether Tenant elects to lease the entire Designated Offer Space on the terms set forth in the Offer Notice, within five days after Landlord delivers to Tenant the Offer Notice. If Tenant timely elects to lease the Designated Offer Space, then Landlord and Tenant shall execute an amendment to this Lease, effective as of the date the Designated Offer Space is to be included in the Premises, on the terms set forth in the Offer Notice and, to the extent not inconsistent with the Offer Notice terms, the terms of this Lease; however, Tenant shall accept the Designated Offer Space in an “AS IS” condition and Landlord shall not provide to Tenant any allowances (e.g., moving allowance, construction allowance, and the like) or other tenant inducements except as specifically provided in the Offer Notice.

If Tenant fails or is unable to timely exercise its right hereunder with respect to the Designated Offer Space, then such right shall lapse, time being of the essence with respect to the exercise thereof, and Landlord may lease all or a portion of the Designated Offer Space to third parties on such terms as Landlord may elect. Landlord shall not be obligated to re-offer the Designated Offer Space to Tenant unless Tenant does not accept the Offer Notice and Landlord fails to enter into a Lease Agreement with respect to the Designated Offer Space within 180 days after the date of the Offer Notice. Tenant’s rights under this Exhibit shall expire as to any portion of the Offer Space that becomes subject to a new lease following the Lease Date. Unless otherwise agreed in writing by Landlord and Tenant’s real estate broker, in no event shall Landlord be obligated to pay a commission with respect to any space leased by Tenant under this Exhibit, and Tenant and Landlord shall each indemnify the other against all expenses, costs, attorneys’ fees, and other liability for commissions or other compensation claimed by any broker or agent claiming the same by, through, or under the indemnifying party.

Tenant’s rights are personal to TENANT and shall terminate, at Landlord’s option, if (i) this Lease is terminated, (ii) Tenant assigns its interest in this Lease or sublets more than 20% of the Premises, (iii) Tenant ceases to lease the entire Premises demised as of the Lease Date from Landlord and to occupy at least 80% of the Premises, or (iv) less than 15 full calendar month remains in the Term of this Lease (unless, concurrently with exercising its right, Tenant also irrevocably exercises its renewal right, in which event Tenant’s rights under this Exhibit shall terminate at the expiration of the initial Term).

In addition, it shall be a condition to the effectiveness of the exercise by Tenant of its rights hereunder that, at the time of exercise of the right of first offer or as of the effective date of the addition of the Designated Offer Space to the Premises, (x) there is no existing Event of Default by Tenant, and (y) Tenant satisfies the Net Worth/Credit Threshold, unless Tenant provides to Landlord additional security (either in the form of a security deposit or a letter of credit) in an amount reasonably acceptable to Landlord.

The post Right of First Offer When Leasing Commercial Real Estate appeared first on Austin Tenant Advisors.

Right of First Refusal When Leasing Commercial Real Estate

The following post is copyrighted by Austin Tenant Advisors - .

If your company expects to grow rapidly by hiring additional employees sooner than later you want to try negotiate a right of first refusal (ROFR) on any additional space in the building. This could be any contiguous space, non-contiguous space, both or a combination of.

Whether you are leasing office, retail, or warehouse space if you expect rapid growth then you must do your best to secure the option rights to additional space. Otherwise your only option will be to relocate your company. For example, in a hot area like the Austin commercial real estate rental market space is tight so it’s important to create more options for your company.

What is a Right of First Refusal?

A right of first refusal is a negotiated right of a tenant in a commercial lease to match any offer received by a landlord to lease a demised or other premises. Basically on any space that you have a ROFR on the landlord has to give you first dibs on any pre-negotiated deal with another party. You are not obligated to take the space. It’s your option.

Ideally you want to get a right of first refusal on any adjacent or contiguous space however that depends on what the neighboring tenants negotiated in their lease. If the contiguous space is not possible then you want to get a ROFR on any non-contiguous space which is space not adjacent to yours. It could be on the same floor or different floors. If another tenant already has a ROFR then you could get a ROFR that is secondary to theirs.

How a Right of First Refusal Works in a Commercial Real Estate Lease

Let’s say you are negotiating on 5,000 sf of Austin office space for rent in a particular building and you don’t quite know your future office space needs. To increase your chances of having more space in the building to grow into you ask for a right of first refusal. 

The landlord is still able to market any available space they have in the building. However if the landlord gets an offer from another potential tenant that they are willing to accept the landlord has to present the offer to your first, giving you the opportunity to accept or decline the space. 

If you accept the deal then you have to take the same rates and terms that were negotiated by the other party. If you negotiated an ongoing ROFR then you will be able to exercise a right of first refusal again in the future after that party’s lease expires.

Example of a Negotiated Right of First Refusal in a Commercial Lease

If Landlord receives a bona fide offer from a third party (including the then-current tenant or occupant therein) (a “Third Party Offer”) to lease any of the 14,209 rentable square feet of space on the 1st floor of the Building, or any of the 6,978 rentable square feet of space on the 2nd floor of the Building, in each case designated on Exhibit A hereto (the 1st floor space and 2nd floor space being, collectively, the “Refusal Space”), and Landlord is willing to accept the terms of such Third Party Offer, Landlord shall offer to lease to Tenant the Refusal Space on the same terms and conditions as the Third Party Offer; such offer shall (a) be in writing, (b) specify the part of the Refusal Space being offered to Tenant hereunder (the “Designated Refusal Space”), (c) specify the rent to be paid for the Designated Refusal Space, and (d) contain the basic terms and conditions of the Third Party Offer and the date on which the Designated Refusal Space shall be included in the Premises (the “Refusal Notice”). Landlord and Tenant hereby agree that: (i) if the Third Party Offer is for less than all of the Refusal Space located on the 1st floor, Tenant must exercise its right hereunder as to all of the Refusal Space on the 1st floor (not just that portion subject to the Third Party Offer) and otherwise on the terms and conditions of the Third Party Offer, (ii) Landlord may not accept any Third Party Offer for any portion of the Refusal Space located on the 1st floor prior to March 1, 2012, and (iii) Landlord will not require Tenant to respond to a Refusal Notice for any Refusal Space on the 1st floor prior to March 1, 2012. Nothing in the previous sentence shall pertain to the Refusal Space located on the 2nd floor of the Building.

The Refusal Notice shall be substantially similar to the Refusal Notice attached to this Exhibit. Tenant shall notify Landlord in writing whether Tenant elects to lease the Designated Refusal Space subject to the Third Party Offer on the same terms and conditions as the Third Party Offer in the Refusal Notice, within five days after Landlord delivers to Tenant the Refusal Notice. If Tenant timely elects to lease the Designated Refusal Space within such five-day period, Landlord and Tenant shall execute an amendment to this Lease, effective as of the date the Designated Refusal Space is to be included in the Premises, on the same terms as this Lease except (1) the Basic Rent and parking charges shall be the amounts specified in the Refusal Notice, (2) the term for the Designated Refusal Space shall be that specified in the Refusal Notice, (3) Tenant shall lease the Designated Refusal Space in an “AS IS” condition, (4) Landlord shall not be required to perform any work therein, (5) Landlord shall not provide to Tenant any allowances other than those contained in the Third Party Offer (e.g., moving allowance, construction allowance, and the like) if any, and (6) other terms set forth in the Lease which are inconsistent with the terms of the Refusal Notice shall be modified accordingly.

If Tenant is unable to exercise its right hereunder with respect to the Designated Refusal Space, such right shall lapse, with respect to the exercise thereof (it being understood Tenant’s right hereunder is a one-time right only as to each Designated Refusal Space the first time it is offered to Tenant hereunder), and Landlord may lease all or a portion of the Designated Refusal Space to third parties on such terms as Landlord may elect. Landlord shall not be obligated to re-offer the Designated Refusal Space to Tenant unless Tenant does not accept the Refusal Notice and Landlord fails to enter into a Lease Agreement with respect to the Designated Refusal Space within 180 days after the date of the Refusal Notice. Unless otherwise agreed in writing by Landlord and Tenant’s real estate broker, in no event shall Landlord be obligated to pay a commission with respect to any space leased by Tenant under this Exhibit, and Tenant and Landlord shall each indemnify the other against all costs, expenses, attorneys’ fees, and other liability for commissions or other compensation claimed by any broker or agent claiming the same by, through, or under the indemnifying party.

Tenant’s rights under this Exhibit are personal to Tenant and shall terminate, at Landlord’s option, (i) if this Lease or Tenant’s right to possession of any of the Premises is terminated, (ii) if Tenant assigns its interest in this Lease or sublets more than 20% of the Premises, (iii) if Tenant ceases to lease the entire Premises demised as of the Lease Date from Landlord and to occupy at least 80% of the Premises, or (iv) on June 30, 2012.

In addition, it shall be a condition to the effectiveness of the exercise by Tenant of its rights hereunder that, at the time of exercise of the right of first refusal or as of the effective date of the addition of the Designated Refusal Space to the Premises, (x) there is no existing Event of Default by Tenant, and (y) Tenant satisfies the Net Worth/Credit Threshold, unless Tenant provides to Landlord additional security (either in the form of a security deposit or a letter of credit) in an amount reasonably acceptable to Landlord.

The post Right of First Refusal When Leasing Commercial Real Estate appeared first on Austin Tenant Advisors.

Office Space Planning Tips

The following post is copyrighted by Austin Tenant Advisors - .

At a company grows proper office space planning becomes more important to ensure that employees are happy and productive and that the company is successful. You’re going to need more offices, open space, and collaborative space. You want to ensure that employees that work together frequently are in close proximity. Also, the ideal office space plan is one that will allow you to add seats when you need them however keep you from leasing or paying for more space than you need. In Austin Tx office space rental planning is a critical component when evaluating options.

The trend seems to be open office space concepts however just because it works for others does not mean it will work for you. You want to make sure you research what is working for others and what is not. You want a functional space that meets the overall needs of the company and culture. Some office planning experts suggest asking yourself a few key questions:

1. What kind of space does each department need to work productively and efficiently?
2. How does space effect each person’s job function?
3. What is the ultimate goal or objective the company wants to obtain with the office space?

Why is it Important to Office Space Plan?

1. Your employees will spend just about the same time at the office as anywhere else.
2. The office environment is one of the most critical elements to employee job satisfaction.
3. Businesses are trying to reduce their cost by properly using their office space by fitting more people into an existing space and having less space go unused.
4. A good space plan can increase the flexibility for employees, attract and retain talent, support cultural changes, and enhance productivity & creativity.

Steps in Office Space Planning

1. Create a list of departments – Visit each department. Find out what they like, need, and want as well as what they don’t like. Create a list of all the departments and how they interact with one another.
2. Get a current headcount of all employees – How many employees do you have now?
3. Estimate future headcount – When office space planning you need to forecast as best as you can how many employees you will have 12-24 months from now as well as 3-5 years from now. Most office space leases you sign will be 3-5 years so you want to make sure the space will accommodate your current and future needs or that you have expansion options.
4. Use – What will each room be used for? You want to ensure that each room serves a purpose and/or function. Office space planners should take notes of needs and wants of each department to ensure the spaces is used 100%
5. Layout – Do you need lots of offices or an open layout? The layout should compliment and support the overall use of the space.
6. Determine who will be in offices or cubicles – Not every employee will be able to have their own office. Think about which employees need offices and which ones will be seated in the open area
7. How many conference rooms – How many conference rooms do you have now? Are they being fully utilized? Based on your current and future headcount projections do you have enough conference rooms? 
8. Break areas – Do your current employees use the break room? How often and to what capacity?
9. Restrooms – Are there efficient restrooms to accommodate your current and future needs?
10. Foot Traffic – How many people move through the space each day? Think about your employees, visitors, vendors, etc.
11. Employee proximity – Which employees collaborate daily and need to be near each other?
12. Equipment proximity – Which employees need to be near the copiers, printers, or other office equipment?
13. Appearance – How do you want the space to look and feel to employees and visitors? Does it reflect your company culture?
14. Technology – What are the technology needs? Cubicles used to be all hard wired with phone/data lines, however some companies have their employees exclusively use their mobile phones. Think about what technology you will be using now and in the future.
15. Allow for growth – Consider the future growth needs of the company as you plan the office.
16. Talk to Others – Have you spoken to other organizations about how they implement office space planning? What is working for them and what needs improvement?
17. Think outside the box – What else should you be thinking about as your office space plan is developed?

 

The post Office Space Planning Tips appeared first on Austin Tenant Advisors.

Music Lane Office Space – 1100 S Congress Ave Austin Tx 78704

The following post is copyrighted by Austin Tenant Advisors - .

Music Lane Office Space consists of 2 class A office buildings located in South Congress at 1009 & 1100 S Congress, Austin, Tx 78704. If you are looking to rent office space close to downtown Austin within walking distance to numerous retail shops and restaurants and want to be a part of Austin’s South Congress experience then you definitely want to check out this new project.

If you are interested in leasing class A office space in Austin Tx and would like help finding the options that best suit your needs then contact us at 512-861-0525.

Building 1

• Address –  1100 S Congress Ave
• Size – 32,872 RSF… Floors 2-3
• Typical Floor Plate – 16,000 RSF

Building 3

• Address – 1009 S Congress Ave
• Size – 18,903 RSF… Floors 2-4
• Typical Floor Plate – 4,000 to 7,000 RSF

Parking Ratio – 2.5 per 1,000 sf. Structured parking garage under building 1

Class Office – A

Amenities on Site – Onsite fitness & dining options and parking

Asking Base Rental – Call for rates

Estimated Operating Expenses (NNN) – Call for rates

For information about Music Lane office space or other class A office spaces near downtown Austin Tx give us a call. We can help you search for and find the best options that meet your current and future needs.

 

The post Music Lane Office Space – 1100 S Congress Ave Austin Tx 78704 appeared first on Austin Tenant Advisors.

Alvin Lindsay thanks for following me on Twitter! https://t.co/4LrJ8OqsVI

Alvin Lindsay thanks for following me on Twitter! https://t.co/4LrJ8OqsVI

— Nathan K Smith (@AustinTenantAdv) April 1, 2018

from Twitter https://twitter.com/AustinTenantAdv