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PROPERTY ACQUISITION

When we start working with a client looking to relocate or acquire new premises, we want to get a clear understanding of them as a business, the space they need now and expect to need in the future, how they work, what they need their space to deliver to their employees and clients, and finally, what type of building, architecture amenities, facilities and location would complement their brand.

The industry uses a rough rule of thumb of 1 person per 100 sq ft but this can vary considerably depending on the environment that is needed. For example you need to consider how big the reception area needs to be,  how many meeting rooms are needed, what break out spaces do your people need?, how many members of the senior team need a private office?, tea and coffee provisions, storage and comms, also affect the efficiency of the space. You should consider the following when drawing up your shortlist of options:

  • Lighting
  • Environmental beliefs and preferences
  • Open plan to cellular ratio
  • Formal to informal space ratio
  • One floor or a whole building
  • Quality and style of finishes
  • Building amenities
  • Location
  • Transport
  • Other local occupiers
  • Shopping, eating and drinking

Listen, don’t assume

Engaging people at an early stage of a move will help them to feel part of the decision process and more likely to thrive in the new environment. Your people will know what makes them happy and more productive, much better than you do. A neon lit sports bar themed break out area might look good, but providing space for exercise and relaxation may reduce stress levels and improve overall productivity.

Once you have identified a shortlist of appropriate properties, approach the leasing Agents who are marketing them and ask them to propose terms based on your preferred lease length, amount of space, and contribution towards fit out, etc.

Do a comparable cost benefit analysis of each option, which will then inform your negotiating strategy when you make a counter offer.

Be prepared

When the Landlord considers having you as a Tenant, there will be several issues on which he will base the attractiveness of the proposition. In order to optimise the merits of your offer, you need to prepare the answers to the questions the Landlord will no doubt want to know.

Timing

What are your current lease obligations and when could you be in a position to move?

Covenant

How safe a bet are you? What do your last three years’ financial reports and accounts look like? What is the financial position of the company and what assets and liabilities does the business have?

Use

What does the business do? Will there be lots of people using the building, day and night, with lots of visitors and deliveries? Or, are you in financial services with senior people who are each allocated 500 sq ft? Either way, the Landlord will want to know whether you will be complementary to the current Tenant mix and how you will wish to utilise his building.

Advisors

Who is advising you on the transaction and is that going to cause a conflict of interest? List your lawyers, property and financial advisors, accountants etc.

The Future

What is your business plan and what are your growth prospects?

The Landlord will be keeping an eye on the asset value of his building and how your covenant will be perceived by the investment market.

If you have proven strong growth in an emerging sector, have a large cash pile to fund future growth, and are prepared to sign a lease for a reasonable length of time at a reasonable rent, the Landlord will want to protect rental levels but may be prepared to give a generous rent free period to contribute towards the costs of fitting out.

When the rental market is in decline, the Landlord will be very keen to agree a deal sooner, rather than later.

Negotiating the right rent is obviously very important to every business, but it is also important to make sure the space is right for your business now and is as future proof as it can be, to help your business thrive in future.

The environment has a significant impact on your people and how productive they are, so make sure you are making the right commercial decision by taking into account all of the issues that affect your business, and not just the costs.

It is also important to use this opportunity to understand how the Landlord operates and how you can expect to be dealt with during your occupancy.

Using Experts

Engaging with consultants, like The Lorenz Consultancy, who have experience of property acquisitions, facilities management, fit-out and relocation, and can communicate at all levels, is a significant investment, but it may be one of the best investments that you can make.

Our team understands property and the impact it has on business. They also have detailed knowledge of the market place and can help find the right solution for your business.

HELP

If you need help, it is time to contact The Lorenz Consultancy, we are permanently dealing with commercial acquisitions and disposals, so have up to date market knowledge.

Use our SPACE CALCULATOR to help get an understanding of the amount of space your business may need.