![]() ![]() It also demanded a higher rent per square foot-a double blow. A well-known Manhattan landlord told a tenant I know that the tenant’s space had grown 20 %. On lease renewal, the tenant may also find that the landlord has “remeasured” the space and now claims it’s much larger. Then, whatever number the landlord uses, you’ll know how much you’ll be paying per usable square foot, and you’ll have a more informed basis for negotiation. The architect should use a generally accepted standard, like that adopted by the Building Owners and Managers Association, so you can precisely compare one space with another. To protect yourself, you might hire an architect to measure the space you plan to lease and tell you whether the usable area will satisfy your business’ needs. Once they’ve determined how big a space is, they just inflate the number by, say, 25 % and then call that the rentable area. Some buildings seem to be measured from gargoyle to gargoyle-facade ornaments unrelated to a tenant’s usable space.īeyond this, many landlords create an arbitrary loss factor. A landlord may measure from the outside of one exterior wall to another, for example, and include questionably “public” areas like air shafts. In addition, landlords often develop their own methods for measuring rentable area. Fancy curves or sharp angles, elevator banks placed in the center of the building instead of on the side, and an abundance of columns in your space contribute to a higher loss factor. Be aware, however, that some buildings have a higher loss factor than others. Rentable area is sure to include a portion of elevators, janitors’ closets, lobbies, stairways, and more. This difference, the loss factor, depends on three things: the physical configuration of your offices, your landlord’s method of measuring rentable area, and, increasingly, your landlord’s whim. Normally, you’ll be able to use only 75 % to 90 % of what you pay for. Office space priced per “rentable” square foot often turns out to be much more expensive than tenants expect because landlords may include space that tenants consider unusable. Here are some of the more obscure lease provisions that protect landlords at their tenants’ expense. Legally acceptable arrangements can be bad business deals.įortunately, if you’re savvy and reserve certain rights, you can turn an office lease into a tremendous asset. A good real estate lawyer can help protect your interests, but often isn’t equipped to advise on business points. ![]() The landlord is highly motivated to plan for the long term and to write conservative leases that maximize the return on their assets. Its business is leasing space, and buildings are its major asset. If you’re like most tenants, you negotiate a lease once every five or ten years and you put rent into the same category as other routine, current business expenses, weighing the monthly payment versus your cash flow. The first thing to understand is that when you negotiate an office lease, your landlord probably has the advantage. But it can be unnecessarily expensive if you don’t understand the hidden costs and restrictions that are buried in many leases. Office space rental is often a big expense for a small company. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |