Is your business new to the process of finding an office space for lease in Kansas City? This process can involve a lot of new real estate jargon and some major financial pitfalls for an unprepared lessee. But fear not, here are a few terms and tips to know as you look for commercial real estate, as suggested in the articles “What is the Difference between Usable vs. Rentable Square Feet?” and “You Don’t Need So Much Office Space”:
Commercial Real Estate in Kansas City Terminology
When you’re looking for an office space to rent, there are some basic terms you should be familiar with. Here are a few to add to your list:
- Usable Square Footage – This is the specific part of the property your business will occupy. If you are renting a full floor, the usable square footage includes everything on that floor, except elevator shafts and stairwells, and would encompass things like janitorial closets, electrical rooms, common areas, hallways, etc. If you are only renting part of a floor, usable square footage is all office space, private restrooms, and storage. Be aware that this also factors in odd areas like columns or recessed entries.
- Rentable Square Footage – When you are renting an office space, you will also have to pay for areas in the whole building that all tenants use, including lobbies, stairways, meeting spaces, corridors, etc. So rentable square footage includes both the usable square footage and a share of these common areas, generally pro-rated based on how much of the property a tenant occupies.
- Common Area – This was touched on briefly in usable and rentable square footage, but can be further broken down:
- Building Common Area – places a tenant shares expenses for in the entire building space (typically a tenant’s share is 6-8%).
- Floor Common Area – specific parts of a floor that are common to all tenants on that floor (typically a tenant’s share is about 8%).
- Load Factor – This is what landlords use to calculate rentable square footage based on the amount of common area in a building. To calculate the load factor, landlords divide the total square footage of the building by the total usable square footage of the building.
These different terms and calculations are essential to understanding how much you will pay in a lease and how much space you will actually get for that rate, so go into tours of spaces ready to do a little math.
Looking for Deals in Commercial Real Estate Listings in Kansas City
Renting commercial real estate can be a huge expense for businesses, so getting a good deal on a space is always a priority. There are a few different ways to do this:
- Find the lowest price per square foot. This is the most obvious way to get a good deal. Compare rates at different available spaces to see which is the best deal per square foot. Make sure you are aware of rates for both usable and rentable square footage so you are truly comparing apples to apples.
- Find a smaller space. This does not necessarily mean sacrificing your goals for your space or downsizing. Finding a good deal is a hit or miss thing, but designing a small but efficient space is completely within your business’s control. Companies leasing more space than they need is a really common problem, so avoid this pitfall by taking the time to evaluate a space and think about ergonomics and subtle ways to make the space more efficient.
- Find quality property. Another way to save money in the long run is to look for a high quality or new building. Because these kinds of buildings will require less maintenance and repairs, tenants can end up saving money in the long run.
Every business wants to find a good deal on their office space, but keep in mind that there are more ways to save than finding a good rental rate. Be creative with how you plan your office space, and start the researching and touring process well in advance of your move so that you have plenty of time to evaluate your options.
If your business interested in commercial space for rent in Overland Park, KS, give one of our commercial real estate agents in Kansas City a call at 913-685-4100 to learn more about our available spaces and even set up a tour!