Revisions to Negotiate in Your Small Office Lease in Kansas City

Revisions to Negotiate in Your Small Office Lease in Kansas City

Startups and small businesses negotiating for an office space—maybe for the first time—need to know the places in the lease where they have a little leverage and can negotiate for a better deal. Commercial real estate leases are presented to the tenant in a form that very much favors the landlord, but that doesn’t have to be the final word in negotiations. Small businesses might not have as much leverage as bigger companies, but careful planning and a knowledge of what to push for can lead to successful resolutions. And while research and planning is an important factor, a small  business can always benefit from having the assistance of a broker or an attorney in their corner. Here are a few places in a lease where tenants typically find success asking for revisions, as suggested in the article “Small Tenant Lease Negotiating”:

#1 Landlord Consent 

Landlord consent may be required of the tenant in two different cases:

  • Subleasing or Assignment – If a tenant wants to sublease a space or completely assign the lease to a new business, they may be required to get the approval of the landlord for the new tenant. While the tenant might not be able to negotiate for the elimination of this clause, one thing that could help is to require that the landlord must be reasonable in their rejection of a potential new tenant.
  • Transfers – If a business experiences some sort of change in ownership due to a shift in stock shares or a merger with another company, they may also have to get the consent of the landlord to transfer the rights of the lease to that new party. To have this flexibility, try to negotiate for landlord consent to not be required in the event that the transfer the result of a merger or a business buying the majority of your business’s assets. Often landlords will agree to this as long as the new ownerships has the same financial worth as the original.

#2 Common Area Maintenance Audits

Most standard leases do not contain any mention of an audit if there is a dispute over the common area maintenance rates, but it is common for a tenant to be able to negotiate for this right. Typically this clause stipulates that the two parties will try to resolve the issue within a specified period of time, but if they cannot reach an agreement, a certified third party auditor will be called in to resolve the dispute. It is also possible to specify that the landlord needs to assist with the audit costs in certain cases.

#3 Tenant Alterations

An original lease will often completely prohibit any alterations without the permission of the landlord, but this is typically seen as an extreme restriction—one that would require you to call the landlord every time you hang a picture on the wall. Try to limit this by negotiating for the right to make mall cosmetic changes to the interior of your space, for example painting the walls or changing the carpet. As long as the changes a tenant wants to make are non-structural and not visible from the exterior, most landlords are willing to allow the tenant to make cosmetic changes within a certain budget limit.

#4 Capital Improvements

Some landlords will want to pass the cost of capital improvements—improvements or replacements to the whole building or property—on to the tenant. However, because these alterations will increase the value of the property for the landlord beyond your tenancy, try to negotiate for the landlord to carry the burden of these costs.

The only two exceptions to this rule would be alterations to comply with new laws—but only laws put in place after the you move in, not improvements to correct pre-existing violations—and improvements that will lower the operating expenses of the building. However, you as a tenant should only be responsible for these improvements in proportion to the savings the landlord reasonably believes they will cause.

These are just a few of the possible areas where you might be able to negotiate for some revision in your lease. Be sure to also talk to a broker or an attorney about ways you can negotiate for better occupancy/abandonment requirements, revisions to the mitigating damages clause, and a request to waive punitive damages or claims for profit loss. Commercial leases can be complicated documents, but with the right preparation and support team, even new or small businesses can get a great deal on a perfect space!

Is your business looking for a small office rental space in Kansas City? Give us a call at 913-685-4100 to tell us what you are looking for in a space and find out more about our available affordable office space in Kansas City.


3 Questions You Should Ask About Your Kansas City Office Space Lease

3 Questions You Should Ask About Your Kansas City Office Space Lease

Renting commercial real estate can be a more complicated process than one might think. With markets varying based on location, outdated terminology, and very little regulation, the process can be confusing for a business looking for a good deal. Here are a few big questions you should be asking throughout the leasing process in order to come out with the best deal possible, as suggested in the article “3 Things You May Not Know About Commercial Real Estate”:

Are there any hidden fees?

Leases can turn out to be riddled with hidden costs if you are not a careful reader and negotiator. One major source of unexpected expenses is Common Area Maintenance costs (CAM). While this is a typical expense you should expect when signing a lease, be aware that the landlord can put a variety of different expenses into this category. For example, landlords have to pay property management or asset management fees, but sometimes they can pass this cost onto the tenant through CAM charges.

Know that a lot of costs are unavoidable, but it is important to know the exacta amount you are paying, what that money is going to, and whether you are being asked to pay a fair percentage of those costs. Don’t be afraid to clarify and negotiate these kinds of terms.

What is my real square footage?

Square footage, which describes the size and boundaries of an office space, seems like it would be a standard measurement, but there are actually varying ways that square footage is calculated; different markets have different ways of measuring property in terms of what they include and exclude in their measurement of a space. For example, some measurements might include things like wall cavities or pillars – spaces that you really cannot use.

To avoid paying significantly more rent for space that is unusable, make sure you first clarify with your landlord what exactly the listed square footage includes, and then make sure that you visit the space yourself to check and see that there are not a multitude of awkward, unusable areas that you are being charged for. You might even consider bringing in someone to measure the space for you to make sure everything matches up.

Can I get any financial help to improve a space?

If you know that you need to make some changes or improvements to a space, a big question is where you are going to get the money to do that. You might be able to negotiate for a tenant improvement (TI) package from your landlord, which is money that the landlord puts toward the improvement of the space. This privilege is usually reserved for tents signing a long-term lease, and landlords might really emphasize this benefit to compete with other spaces you are looking at.

However, it is important to closely examine where exactly this improvement money is coming from. Know that most likely the landlord is actually building these improvement costs into your rent in the long run – sometimes even with an interest rate as high as 10%. This can be costly in the long run, so make sure you know exactly what you will end up paying. This improvement package can be great if you do not have the cash initially improve the space, but make sure you don’t wind up ultimately paying more than you budgeted for.

Getting a good deal on a commercial real estate space is possible, but it requires some research and careful negotiation. Make sure you are prepared to get the best deal possible for your business!

If your business is looking at commercial MLS listings in Kansas City, give us a call at 913-685-4100 to find out more about our affordable office space in Kansas City!


3 Tips For Creating and Managing a Healthy Environment in Your Overland Park Office Space

3 Tips For Creating and Managing a Healthy Environment in Your Overland Park Office Space

Establishing and promoting a healthy working environment is essential to a happy, productive office. A healthy lifestyle is something that people primarily have to choose for themselves in their personal lives, but since people spend so much time at the office it can really help them to have a health conscious environment there as well. Here are a few new ideas that encourage healthy habits in the workplace, as outlined in the article “4 Tips For Improving the Health & Happiness of Your Office”:

1. Avoid Unnecessary Stress:

One thing that we hear over and over again at work is to avoid stress; it is the best way to stay healthy. And the experts aren’t wrong about this. Studies have shown that when we aren’t stressed out at work we tend to eat healthier, have better relationships with people in our lives, and be in an overall better mood throughout the day. All of these things are beneficial to employees both in their personal lives and in their work lives. It’s difficult to avoid stress altogether in an office, but trying to create a more comfortable environment and having a read on the office’s stress level is a good way to start making minor changes.

2. Encourage Progress:

Once you have the stress level down you can start encouraging people to make healthier choices in their daily routines. One way of doing this is to keep track of employee’s fitness progress or habits by creating motivational programs or competitions within the office. With this data you can keep track of departments goals, their overall health progress, and who is leading in making healthy choices. You’d be surprised the kind of improvements people make when they can see their progress in numbers and be recognized for their efforts.

3. Sustain a Healthy Environment:

After encouraging progress in employees and eliminating stress you have to maintain that healthy office environment. It is easy to fall back into old habits after a few weeks of healthy changes. The best thing someone can do is to create an overall health program for the office to be continued over a long period of time. This could include a number of things, like healthy snack options, office fun runs, and walks after lunch.  Common spaces and break rooms can be transformed into places where employees can relax and enjoy their time.

These changes are, of course, gradual but you’ll be surprised by the improved happiness and productivity of employees over time once these changes are implemented in a workspace.

If you are interested in finding affordable office space in Kansas City you may want to try a commercial real estate broker in Overland Park. Call 913-685-4100 for more information about our available space!


4 Ideas For Keeping Your Kansas City Office Space Cool

4 Ideas For Keeping Your Kansas City Office Space Cool

With temperatures rising, the change from a boiling hot spot and a cool office makes all the difference with employee comfort and productivity. Here are some tips on how to turn a sauna of an office into cool breezy workspace, as outlined in the article “5 Tips for Keeping Your Office Cool During the Hot Summer Months”:

1. Close the windows and turn on the AC.

This one might seem like a no-brainer but with winter months behind us one of the best ways to beat the heat is to close the windows and keep cool air inside. A combination of an open window and blasting air conditioning not only hurts the energy bill but also causes the office to become hotter. Keep the hot air outside and the cool air inside by making sure your air conditioning unit is up to date and running efficiently.

2. Avoid dehydration.

Dehydration can cause several problems for employees during the hotter months. Keeping water nearby and plentiful can help with the overall comfort of employees and increasing the general good mood of everyone in the office, so make sure the office water cooler is available to everyone.

3. Switch off and cool down.

Do you have some electronics that aren’t being used during the summer months, or at all? Like an obsolete fax machine that only costs you money by increasing your energy bills? Turn it off and unplug it. Doing this can help reduce the temperature in the office by making sure certain electronic equipment isn’t giving off excess heat that the office definitely doesn’t need.

4. Ditch the suits and heavy clothing.

Comfort seems to be a key to better moods and productivity, so if you want to see customer satisfaction increase because of the better moods of your employees it might be a great idea to implement a more casual dress code. Have employees ditch the constricting suit and tie instead let employees come in whatever they want; this will help better moods in many ways.

Giving attention to comfort during these hot summer months can help a lot with productivity, so cool down your office and keep it working strong!

If you are looking for affordable office space Kansas City, try a commercial real estate broker in Kansas City. Call 913-685-4100 for more information about our available space.


Choosing a Location for Your Office Space in Kansas City

Choosing a suitable location is a critical component of setting up your small business in its first official office space. Your location has a major impact on your business, so it is important to carefully consider several factors and work with a commercial real estate agent who knows the area when you are choosing an office space. Here are a few suggestions for points to think about when deciding on an office rental property, as suggested in the article “How to Find & Lease Office Space”:

#1 Choose a location based on your needs.

If you are a legal firm, for example, and you know that you will be regularly visiting the city’s courthouse, finding a space near the courthouse could be a huge time saver for you. Think about what your business needs and the places you will need access to—you might get lucky and find a great space in a convenient area.

#2 Consider the commute.

Think about the employees you have or the workforce you want to draw from when you choose your location. It is important to find a location that is relatively close to them if you want to satisfy and keep those employees. Sometimes it is impossible to please everybody, but if you have a more central or convenient option, this might be a big bonus for both your employees and your clients/customers. Another thing to think about is whether the space is near a major highway or public transportation. Whether highways or public transport is more of a priority depends on your kind of business, the accessibility of public transport in your city, and the availability of parking spaces.

#3 Locate in a good environment.

Another thing to consider is whether the businesses in the area are compatible with your business. Some good things to have nearby are restaurants, cafes, or fitness centers where your employees can get away for a little while during lunch. Proximity to these kinds of businesses means that your employees won’t feel rushed and stressed during their lunch breaks.

Location is hugely important to small businesses, not only for attracting clients, but also for taking care of your business’s and employees’ needs.

If your business is looking into commercial space for lease in Kansas City, give us a call at 913-685-4100 to learn more about our affordable office space in Kansas City, located in the heart of Johnson County and surrounded by all of the resources the area has to offer: restaurants, coffee shops, health clubs, and more!


Monthly Expenses for a Triple-Net Office Space Lease in Overland Park

If you’re looking to lease a commercial office space, one of the first things you have to do is plan your budget. In order to do this, it is helpful to know what your monthly expenses will be in an office space. Having an idea of the different fees and costs associated with a space can help you narrow down your options as you search. Here are a few things to consider, as outlined in the article “How to Find & Lease Retail Space.”

One aspect of your monthly costs is the different factors that contribute to your rental rate:

  • Location. Location has a major impact on the monthly rental rate of the space. One aspect of location is how close you are to central hubs of activity. An area that has higher customer traffic means higher rent, both in big cities or in smaller towns. Another aspect of location is the surrounding businesses. If there is a large anchor tenant on your property, you might have to pay more. Also, if you have a prime space near the parking area or facing a main street, You will probably have to pay more then if your space is less visible.
  • Quality of the Space. Another obvious factor is the quality of the space. A place that is move-in ready will be more expensive than a space that you will need to renovate or remodel, but be sure to factor in the cost of improvements and what the landlord will contribute to these costs.
  • Vacancies. A property that has multiple vacancies will probably offer cheaper rates then one with less available space. However, they’re in mind that if it’s a new property it might still be expensive even if it currently has multiple vacancies.
  • Length of Lease Term. If you’re looking for a longer lease, you are more likely to get a better deal on your rental rate. A long lease means more bargaining power, which means that you can try to ask for a reduction of your lease payment or or other costs. On the other hand, a very short lease, such as one year term, means that you have almost no negotiating leverage.

Factors that influence rent are not the only things that you need to consider when planning your monthly budget. Often there are a lot of other costs associated with your lease. These costs will depend on the type of lease that you have. Here are a few monthly expenses you should expect if you have a triple net lease, one common type of lease:

  • Utilities. As with any property, don’t forget to take into consideration utilities, including water, electricity, heat, sewage services, internet services, and any others. You can check with your landlord to see if they have estimates for these monthly fees, but if not you can always call the providers of these services to get a quote.
  • Maintenance. This is something that you should definitely discuss with your landlord upfront to make sure you know who is responsible for what elements of maintenance. You will most likely want to factor in heating and cooling systems repairs, lawn care services, snow removal and any other common issues you expect to encounter. You will also want to consider whether you have common area maintenance costs–fees to take care of spaces that you share with other tenants.
  • Taxes. In a triple net lease, you will be responsible for paying a portion of the property taxes. You should be about to get this information in advance either in the listing or from your broker.
  • Insurance. You will also have to pay a portion of the property insurance, and you can also get a quote for this from either the landlord, your broker, or a local insurance company.

Aside from the factors that affect your rent and your monthly costs, there is one more expense to factor into your budget as you look for space:

  • Broker’s Fee. Don’t forget to plan for a broker’s fee if you plan to work with the broker. There are a few different ways that brokers calculate their rates. Often they charge between 7 and 10% of the total cost of the lease. Another system would be charging you per square foot, which might also depend on the length of the lease term.

If you’re starting the process of looking for a commercial office space to lease, it is important to try to plan your budget before you even start looking. If you have a good idea of your monthly costs as well as what a broker’s fee will be, you can start to look at properties that are in your price range, rather than wasting your time and energy looking into spaces that you will not be able to afford.

If you would like to learn more about office lease rates in Kansas City, give us a call at 913-685-4100. We can also tell you more about our affordable office space in Kansas City, and you can even set up a tour!


3 Essential Things You Need When Renting Your First Office Space in Kansas City

Regardless of what kind of space you’re looking for, if you want to rent an office space for the first time there are a few things to keep in mind, starting with the fact that the landlord is renting out the space for the purpose of making money. This means that you as a potential tenant need to both convince them that you’re a reliable business to lease to and also look after your own interests during negotiations. Be ready to answer the landlord’s tough questions and prepare yourself for the whole process by considering a the following factors, as suggested in the article “Steps to Secure Your First Commercial Space”:

#1 A Business Plan

Having a solid business plan to show a landlord is especially important for new companies who can’t provide a history of financial statements to show their credit worthiness. Think of showing a business plan to landlord as similar to pitching your company to investors. A landlord is also taking a risk and making an investment in the success of your business, so it is important to give them a clear, realistic, but hopefully positive outline of where your business is headed. If your company is simply relocating, try to supply the landlord with information about your rental history and previous budget plans to show that you are a financially stable tenant.

#2 An Agent

While it is possible to rent a space without an agent, an agent can be extremely helpful, particularly for new businesses who don’t have a lot of experience with the commercial real estate market. It is important to select an agent who will work with you throughout the entire process and who is representing only your interest and not acting as an agent for both you and the landlord. Remember that the listing agent named on the property’s advertisement was hired to work for the best interests of the landlord. One advantage of working with an agent is that they know the markets and can give you an idea of fair rental rate in that area. They can also help you during negotiations, which could save your company a significant amount of money in the long run, and they are also familiar with the language of leases, so they understand what will benefit or potentially hurt your company. If the landlord pays for your agent, as is almost always the case, there is very little downside to working with an agent.

#3 An Exit Strategy 

Although it’s not the most pleasant thing to think about, just as you have an exit strategy for your business you should also have an exit strategy for your lease that is factored into your lease negotiations. If you’re working with a good agent, they should be able to help you negotiate for certain provisions that will make it easier to get out of the lease if absolutely necessary. Some of these provisions include a sublease or assignment clause, or an early termination clause. This aspect of renting a space can be difficult to navigate and absolutely must be taken care of before signing the lease, so strongly consider consulting with an agent as you form your exit plan.

A favorable lease is so important, particularly for small businesses just starting out in their first rental space. If you don’t have a lot of experience with the commercial real estate market, it is important to prepare yourself for negotiations by having a business plan and exit strategy ready, preferably with help from an agent.

If your business is considering a small office lease in Kansas City, give us a call at 913-685-4100 to learn more about our affordable office space in Kansas City.


4 Types of Signage for a Kansas City Office Space

Signage is an important question to consider when looking at an office space for lease. Here are a few possible kinds of signage or identity options a landlord might offer to tenants in a multi-tenant property, as suggested in the article “Got Signage?”:

  • Building Signage – tenants can often get signage somewhere on the side of the building. This can allow multiple tenants of the building to all have signage with anchor tenants higher up on the building and others on other parts of the property, such as the parking garage.
  • Exclusive Building Signage – this means that a tenant has exclusive rights to put their sign anywhere on the building, typically at the top. Usually this right goes to an anchor tenant or one that leases the most space, possibly multiple floors.
  • Monument Signage – many office buildings have monument signs with room for multiple tenants listed on them. The monuments could hold just two or three signs, or as much as ten.
  • Exclusive Monument Signage – in some cases a high paying or anchor tenant might negotiate to have their own monument sign in front of the building featuring only their company.

Be sure to talk to your landlord about your signage options before signing a lease!

If your business is interested in office suites for rent in Kansas City, give us a call at 913-685-4100 to learn more about our affordable office space in Kansas City.


2 Factors for Assessing a Commercial Office Space in Kansas City

2 Factors for Assessing a Commercial Office Space in Kansas City

There are two important components to consider when renting commercial real estate. Most important is the piece of property itself – the location, any necessary improvements, and the state of the buildings. The second is the lease, which encompasses the business side of the deal. Here are a few tips for weighing the pros and cons of each of these considerations, as suggested in the article “How to choose the right commercial property”:

The Property

One thing to consider is the state of the rental buildings. They might be in a very established area and highly trafficked, but if they are older buildings, they might require a lot of improvements and maintenance. Consider also whether the location is suited to your type of business. It might be important for you to be near the city center, but know that the rent will also be higher there than on the fringes of a city. For example, if you receive regular shipments you may want to be near easy highway access, or if you’re in retail you might want a location with a lot of foot traffic.

The Lease

Consider whether the type of lease offered is best for your business at this point in time. For example, a startup business will most likely want a shorter lease with options to renew, but a more stable business might want a longer lease and the benefits it offers. Make sure you understand clearly who is responsible for what costs, including maintenance, taxes, repairs and all of the other expenses associated with a commercial property. If the lease doesn’t make good business sense for your company at this time, it is wise to walk away no matter how much you like the property.

When selecting a commercial property, consider all aspects of the property in the lease. Do not hesitate to ask a lot of questions and negotiate for favorable provisions. Talk extensively with your landlord – through an attorney or commercial real estate agent if possible to get expert advice. You will be stuck with the space for at least a year or a two, so it is extremely important to make sure it’s exactly what you want.

If your business is looking at commercial MLS listings in Kansas City, give us a call at 913-685-4100 to find out more information about our affordable office space in Kansas City or to set up a tour.


Create a Checklist for Your Small Business in a New Office Rental Space in Kansas City

Small business owners tend to be more successful the more organized they are with determining and executing their start-up needs. Before actually putting a business plan into action, it is important to make a checklist that includes financing, business registration, legal work such as licenses and permits, and leasing a space.  Think about what order these things need to happen in, such as creating a business plan in order to apply for a loan and registering a business with the necessary government offices before applying for a banking account.  Here are some tips for what to include on a checklist of essential steps to getting a small business up and running, as suggested in the article “Setting Up a Small Business”:

#1 Business Plan

The absolute first step in setting up a small business is creating a business plan, which will serve as a road map showing how you will get financing; how your budget will be organized into money for leasing, licenses and permits, employee costs, advertising, improvements and build outs to a space; and your overall vision for how your business will operate and generate profit.

#2 Finances

Once you have an idea of what your budget will look like, the next step is to get the necessary loans to start your business.  A good place to look is through the Small Business Administration, which keeps a list of recommended commercial lenders for start-ups.

#3 Hiring and Employee Expenses

Employee wages and benefits can be one of the biggest expenses for small businesses.  The hiring process is time consuming and can involve a little bit of a financial investment on your part to look into candidates’ legal backgrounds and references.  The expenses of paying employees—benefits included—must be factored into your initial operating expense plans.

#4 Registering Your Business

In order to establish your business legally, it is necessary to register with the correct government agencies. There are several options for how a small business can form: a corporation, a sole proprietorship, a limited liability partnership (LLP), or a limited liability company (LLC).  An Article of Incorporation is necessary for a corporation, while LLCs and LLPs require Articles of Formation or Organization.  All of these articles must be filed with the state, and a business’s name must also be registered with the county or state of location. Finally, in order to be able to open a business banking account and register for federal taxes, a start up has to apply for a federal Employer Identification Number (EIN) through the IRS.

#5 Rent or Buy?

The next step to establishing a small business is finding a space in which to operate.  If you are hiring employees, it is likely that you will not have enough space for them in your home, so it will be necessary to find a commercial space in which to operate.  Most small business owners choose to rent instead of buy to save on initial costs.  Many small businesses opt for Triple Net (NNN) Lease, in which lessees pay for space by the square foot and also pay for a portion of maintenance needs and property taxes.

#6 Storage

If you have a small space for your office, you will most likely need to look into off-site storage options—which are typically relatively inexpensive—to leave more room for working in your commercial space. Look for a place that has both a strong gate and a combination lock, and be sure to check to see if it is climate controlled if you need to store important paper documents.  If you do need storage for your office, try to go for file cabinets and containers that can be stacked to take up as little floor space as possible.

#7 Setting Up Communications

Another thing to add to your checklist is setting up a phone line for your office.  Look into IP broadband phone systems with voice over versus a traditional phone system to potentially save a little money.  You can also look at online auctions or used office furniture stores to try to find a secondhand phone system—often you can get a good deal on a functioning phone system if you look carefully.

#8 Creating Workstations

The next step is purchasing furniture for your office, which you can find deals on through used office furniture stores or even closing sales held by local businesses.  In addition to looking for deals on furniture, try to maximize your use of each piece so you do not have to buy as much.  For instance, a cabinet will do just fine as a place to put a printer, versus an entirely different table for it.

#9 Equipment

Instead of outright buying equipment for your office when you are first starting out, try to lease as much as you can, including copy machines, computers, and fax machines—if possible try to get units that can fax, print, copy, and scan all in one piece of equipment so you don’t have to purchase as much toner or ink.  If you have major copy jobs, you can outsource these to a printing shop in your area and save a little money.  See if you can set up a corporate account with a print shop and maybe get some discounts on regular print orders.

When you are planning a startup, make sure you create an extensive checklist before taking action!

Give us a call at 913-685-4100 to talk to a commercial real estate broker in Kansas City about our affordable office space in Kansas City!