affordable office space Kansas City

10 Things You Must Know Before Signing a Small Office Lease in Kansas City: Part V

Here are a few final things to keep in mind before you sign an office space lease:

9. Location. “Location, location, location” may be an old saying, but it is still a make-or-break factor for many retail businesses. Choose the best location for your business, factoring in as many variables as you can: who are the surrounding tenants? Are there any big name ones that would draw customers, and if so, will they stay? What is the traffic to the space and the demographics of that traffic? Is there enough parking? Will you be competing with any nearby businesses? Consider as many factors as possible and choose a space that will provide the best “return on location.”
10. Get everything in writing. As you prepare to sign the lease, make sure that any verbal agreements or promises are documented in writing. If something is not included in the written agreement, it can most likely be ignored on the basis of clauses in leases that say something to the effect of “this is the entire agreement.” Making sure everything you negotiated for is in writing could prevent unnecessary issues from arising down the line.

Protect your business from problems and ensure you will be setting up in a place that will foster growth by preparing yourself for the lease negotiation process!

If you have decided it is time for your start-up business to find a small office lease in Kansas City, give us a call at 913-685-4100 to discuss an affordable office space in Kansas City that could be perfect for your business!

Operations and Management Administrative Fees for Office Space in Kansas

If you are already paying CAM fees as a tenant, beware of any added fees for operational or management costs. These fees might be labeled as “Administrative Fees,” and are a landlord’s way of trying to get a tenant to contribute to his or her own costs. These administrative fees are typically based on a percent of total CAM costs. As a tenant, you will want to object to such costs, or at least see evidence of how your share of these fees has been calculated. Most tenants object to O&M fees because the landlord already makes a profit off of the rent tenants pay, even without the CAM fees. Here are some tips for dealing with these extra fees in a lease:

If your CAM fee includes O&M fees that go towards liability insurance costs, the salaries for administrators or management (on or off-site), advertising, or professional services (i.e. legal or accounting), you should try to negotiate these specifically out of our lease.
Savvy negotiating tenants will try to reduce the percentage of these fees (which can range from 5% to 25%) and eliminate costs that are not related to maintenance (i.e. utilities, insurance, taxes).
You could try to argue that repair and maintenance costs related to buildings (i.e. roofs, foundations, exterior walls) are not your responsibility because they are not common areas used by you and your customers.

You might not be able to eliminate these fees entirely, but be aware that they might be in your lease and you might be able to at least negotiate their reduction.

If you are looking for affordable office space in Kansas City, give a DDI Commercial real estate broker in Kansas City a call at 913-685-4100 to talk about our available spaces!

Leasing Office Equipment for Your Office Building in Overland Park Part II

Buying office equipment can be a huge expense for a new company. Renting is one other long-term option, but leasing offers several benefits as well. Here are a few of the advantages of choosing to lease your office space equipment:

Leasing can help your business afford more. You might not be able to afford to buy top of the line office equipment for your office space, but you might be able to afford to lease it. Having better furniture and office equipment in your space can boost your employees’ morale and productivity and can create a more professional image for your company.
Leasing could be beneficial for your balance sheet. You might be able to leave some leased assets and related obligations off of your balance sheet. This could potentially improve financial indicators such as your company’s earnings-to-fixed-assets ratio or debt-to-equity ratio. However, remember that accounting rules do require that under certain types of leases you have to report assets leased on your balance sheet.

If you choose to lease rather than purchase equipment, keep your lease short-term—two years is a good length. Negotiating a “modern equipment substitution clause” will let you exchange or update your office equipment so that you can keep up with the changing technology. You will also want to include a cancellation clause that allows you to cancel the lease for a fee, and be sure to note the cost of a cancellation penalty.

Looking for office rental space in Kansas City. Give us a call at 913-685-4100 to find out more about Southcreek’s affordable office space in Kansas City!

Renegotiating Your Small Office Lease in Kansas City to Lower Rent

If the time to renew your Kansas City office space lease is approaching, you might want to think about some strategies for renegotiation, especially since the current economic climate means that you have a better chance of getting lower rates. Here are a few tips to potentially help you lower your rent as you negotiate a new lease term:

Start Early. Landlords know that they can have the upper hand in a negotiation if they wait until you would not have time to find and move into a new space to talk to you about renewal. With this in mind, you should talk to your landlord well before your lease is due to expire, leaving yourself plenty of time to find a new rental space and move if need be. This sends a message to your landlord that you want a better deal and gives you some leverage.
Do Your Homework. Even if you don’t have a lot of time to do heavy research, just doing a little investigating could save your business money in the long term. You could check out the traffic in your area by asking a local business association for numbers or surveying your neighbors. Find out the details on the vacancy rate in your area. See if the rents in your hare are up or down at the moment. Think about your own sales rates; if they are down and you are honest about this with a landlord, they might be willing to work with you to keep you in the space.

Taking these and other little steps before you begin your lease renewal negotiations could get you a better deal on your rent!

If you would like to learn more about affordable office space in Kansas City, give one of our brokers a call at 913-685-4100!

Commercial Real Estate in Kansas City Terms to Know

Are you beginning the process of looking for affordable office space in Kansas City? The real estate rental process can be full of unfamiliar jargon. Here are some basic terms and definitions you might want to be aware of:

A-2 Survey: A legal survey of the measurements of the boundaries of a property, its area, and even its topography. The survey might also include fencing, utility feeds, easements, encroachments, etc. Often this document is required by mortgage holders and is stamped by a licensed land surveyor.
Acre: a measurement of land in any shape that is equal to 43,560 square feet.
Add on Factor: a generally accepted definition that describes the percentage of square footage added on to the base square footage of floor area to account for common areas of a building that are used by all tenants.
Assignment: A transfer to another party of any real or personal property or of any rights or estates in that property. Typically assignments are of mortgages, leases, deeds, or trust, but the term can be used to describe any transfers to title.
Base Rent: The rate determined for the commencement of the lease. This might be subject to yearly increases unless the tenant negotiates otherwise in the lease, Addendum, or an attached amendment. This phrase can have different meanings for different landlords. In some markets, landlords might use it to refer to the rental rate per square footage minus operating expenses.

Check back for later posts on more real estate terms to know!

To find out more about some available office space in Kansas City, give Southcreek a call at 913-685-4100, and find out about the benefits of renting with us!

Letters of Intent and Commercial Realty in Kansas City

Finding commercial property for your business can be a multi-step process. You need to find a location that will best serve your business, make sure the site is up to environmental standards, draw up a contract, and more. This can be a long and arduous process. Creating a letter of intent can be an efficient and nonbinding way to confirm with your lender the potential terms of your lease before undertaking the whole contract process. Here are a few thoughts from an expert on the usefulness of LOIs:

What is an “LOI” or letter of intent? An LOI is a document used in negotiations for the purchase or sale of a piece of commercial real estate. The purpose of an LOI is to set forth the basic business terms of the sale that both parties have discussed and agreed upon before drafting the contract. In most cases, LOIs expressly state that the terms of the LOI are understood by both parties to be not binding.
Should a leaser and renter of commercial property create a letter of intent? It may be in the best interest of both parties to utilize a letter of intent. Because the letter is a record of the essential business terms of the commercial property sale that have been mutually agreed upon, the LOI allows both parties to expeditiously conform in writing their thoughts on the contract and the sale.

Southcreek Office Park has affordable office space in Kansas City for businesses of all sizes. To start discussing a lease with us or find out more information, give us a call at 913-685-4100!