office space lease Overland Park | Southcreek

Overland Park Office Space Negotiation Tips for Small Businesses

If you have been put in charge of negotiating an office space lease in Overland Park for your small business, you may be a bit overwhelmed and wondering how to get a good deal for your business. Negotiating a good lease can be crucial in making sure that your company has enough money to finance future growth.

Often your negotiating abilities are dependent on how much leverage you have. You can figure this out by doing some research on the space—has it been vacant for a while? Are there other companies interested in the space? Knowing these factors can give you an edge in your negotiations. Here are a few other thoughts to consider as you begin your negotiations:

1.   Term of your lease. Even if you aren’t sure how long you want to stay in the space, you might consider the relative advantages and disadvantages of longer or shorter leases. For instance, landlords are often more amenable to making concessions for longer-term leases, but if the demand for rental space decreases over time, you could be stuck paying an above-market rental price if you are locked into that longer lease. A safe bet might be negotiating a shorter-term lease (i.e. a year or two) with options to renew (i.e. four two-year renewal options), versus a ten-year lease.
2.   Amount of space. If you are comparing a few different spaces, you will want to know the exact usable square footage for each space. This is different (less) than the rentable square footage, which includes common areas such as bathrooms, lobbies, elevators, and public corridors.
3.   Permitted use of the rental space. Most leases have a section that discusses how you are permitted to use the leased space. Even if your intentions for the space are initially narrow, try to make this clause as broad as possible to account for the potential growth or change of your business.

If you think you are ready to begin the negotiations process, give one of Southcreek’s commercial realtors a call at 913-685-4100 to talk to us about available executive suites in Kansas City!

More Kansas City Office Space for Rent Options

A renewal option and a short term lease with a renewal option are just a few possibilities for your business’s office space lease in Overland Park. Keeping in mind the future growth or changes of your business, here are a few more options to think about:

3. Option for additional space. Having the option to expand is very important for a growing business. A landlord might be inclined to grant the option for additional space if they feel that you might be an important tenant that could potentially attract other businesses, especially in a retail context. You will want to carefully examine the terms for renting extra space to make sure that option is in your business’s best interests. When you are negotiating your initial option agreement, you will determine with your landlord if you are going to pay for your expansion at the same per square foot price you are already paying, at the fair market price at the time, or at a fixed rate of increase.
4. Option to end the lease early. This option is becoming more popular in commercial leases. Often landlords offer this clause to important businesses with the goal of getting them to sign long-term leases and attracting other high profile tenants. If the tenant exercises their ability to terminate the lease early, the landlord will receive some sort of compensation.
It cannot hurt to look into all of your options as you are negotiating a lease to make sure that you can adequately communicate with a potential landlord the needs of your business.

If you are looking for an executive office in Overland Park, call and talk to one of Southcreek’s commercial real estate brokers at 913-685-4100 to talk about your vision for your ideal office rental space!

4 Negotiating Tips for Kansas City Office Space

Did you know that one of the biggest expenses incurred by a growing company is their office space? Most executive suites in Kansas City have different leases, so learning how to negotiate a lease that will satisfy your business’s needs and save you some money might allow you to hire some more employees or undertake a new project. Here are some tips to keep in mind while negotiating:

1.   Term of your lease. There are positives and negatives to choosing a long term lease. On the one hand, landlords often make concessions for longer-term leases, but it is also important to keep in mind how the needs of your company might change during the course of your lease so a shorter-term lease with renewal options could be a good middle path.
2.   Permitted use of the space. A lease usually includes a section dealing with how the tenant may use the space. It is usually in you as a lessee’s best interests to make this clause broad, in case your business wants to diversify or sublease the space to other businesses.
3.   Operating costs. Operating costs, HVAC, and common area maintenance are things that your landlord might be charging you separately for. If possible, try to negotiate a cap on this amount or a fixed fee.
4.   Increases in rent. A long-term lease rarely comes with fixed rent. Landlords often charge annual increases in accordance with increases in the Consumer Price Index (CPI). If at possible, see if your landlord will postpone this increase until two years into your rent. You might also try capping the amount of each annual increase or negotiating a predetermined fixed amount.

If you would like to ask any questions about negotiating an office space lease in Overland Park through Southcreek, give us a call at 913-685-4100!

Office Building Overland Park

Before you get ready to pick your perfect office building in Overland Park, think about brushing up on your leasing-lingo. Most leases are slightly different, so knowing how to negotiate a lease could help your business save money and get exactly what you are looking for. Here are some suggestions for what to be aware of when figuring out a lease:

Improvements made by the tenant. You might want to make some improvements or changes to your new office space. Be sure to be aware of what your lease says about this. Form leases usually state that a tenant must have the landlord’s consent to make any alterations, so if you are thinking about making any improvements, you might want to make sure that your lease includes a clause that allows you to do so with your landlord’s consent and that the consent will not be delayed or withheld unreasonably. You should also be on the lookout for any clauses that say that a space must be returned in its original condition at the end of the lease.
Common area maintenance and operating costs. Be aware of any operating costs that your landlord is holding you responsible for. If they are separate charges, you might try to negotiate a cap on the amount or a fixed fee.
Option to renew. If you are thinking about renewing, see if you can negotiate to renew your rent at a set predetermined price instead of based on “fair market” price at the time.
Right of first offer and right of first refusal. Right of first offer means that your landlord is obligated to present any space in the building that becomes available to your business before offering it to third parties. Right of first refusal means that your landlord has to offer you first any deals he or she is might make with third parties for a space, giving you the opportunity to preempt the third party and match that deal.

Knowing the ins and outs of a lease could save your business money in the long run and ensure that you are getting exactly what you want from your office space lease in Overland Park.

If you would like inquire about lease negotiations for Overland Park office space through Southcreek, give us a call at 913-685-4100!