6 Tips for Startups Trying To Negotiate a Favorable Small Office Lease in Kansas City

Startups don’t always have the most clout when trying to negotiate a commercial real estate rental with landlords. But it is not impossible for a startup to end up with good terms for their first commercial lease, particularly with real estate markets reviving in some parts of the country. Here are a few tips for negotiating for a favorable lease, as suggested in the article “How Startups Negotiate Favorable Leases”:

#1 Work With a Broker Small businesses—especially startups—can benefit hugely from working with a lawyer who is familiar with the industry and the area.  Talk to other tenants in the building about the brokers they used, and try for someone who has experience with that building, or even just with the neighborhood. Commercial markets can be very specialized, so it is important to not only have representation, but to have representation that knows the context. Be particularly wary of seeking help from the landlord’s broker, who will be prioritizing the interests of the landlord.

#2 Evaluate the Location Consider the positives and negatives of a location. Remember that while a flashy location might be important for some types of businesses, that kind off luxury will also come with higher business license fees and taxes. Also consider things like parking for clients and building access for deliveries.

#3 Know What is Included in Your Rent Depending on the type of lease, your rent might not include everything–for example, you might have to pay separately for utilities, janitorial services parking, property taxes, maintenance of common areas, or insurance. All leases vary and are negotiable, so try to make sure that the terms in your lease match the particular needs and budget of your business.

#4 Ask for Concessions from Your Landlord  Because the real estate market has been in such a slump, landlords have been offering a lot of great deals to tenants. But as markets in many areas start to improve again, these deals may get less and less frequent. Usually sweeteners are offered to long term tenants, so if it is possible, try to get a good deal on a long term lease while you can—but know that shorter leases are generally better for smaller companies because there is less financial risk involved.

#5 Include a Termination Agreement Give yourself an escape hatch both for the possibility that your business is hugely successful or struggling. Whether you have outgrown your space or you are having difficulty paying rent each month, a termination agreement can facilitate a much needed way out. Some landlords will want to be able to approve of a transfer of ownership of your business or ask for a personal guarantee, especially if you are a startup. Make sure that these terms are clear and try to negotiate to make them as favorable as possible. Best case scenario, you do not need a landlord’s permission to transfer a lease, which will allow you to make a deal if need be without worrying about pleasing your landlord.

#6 Try to Get a Cap Fees that increase annually can become a major burden for businesses in long term leases. Try to negotiate for a cap on management and operating fees based on a percentage of your rent. Caps like these can be difficult to get, especially in thriving markets, but they are still worth trying for.

While startups are not in the best position to negotiate great leases, it is still possible to come out with something favorable for your business with a little negotiation smarts.

If your business is looking for office space for rent in Kansas City, give Kathy Woodward at DDI Commercial a call at 913-685-4100!


8 Tech Tips for Your Office Space in Kansas City

Technology in an office can be a fickle thing to deal with, but in this day and age, it is so necessary to have fully functioning technology at all times.  Here are a few common problems with technology that arise in offices, as well as tips for how to troubleshoot, as outlined in the articles “Toby’s Tech Tips: Part 1 & Part 2”:

#1 Slow Computers

Slow performing computers are extremely common tech complaints, but fortunately a little maintenance can usually speed things up. One explanation is that your computer is experiencing a virus, but if you rule out this option, it is more likely that you are using too much data storage.  Storing essential personal and work related documents is so important, but you can save space by moving documents that you don’t need frequently to either a USB device or an external hard drive in order to free up space on your computer.  If you find files that you do not need, don’t be afraid to put them in the “Recycle Bin.”

#2 Too Many Windows 

If you are losing efficiency because you constantly have multiple windows open on your computer, consider getting another monitor.  You can even set up dual monitors in the same stand, and these monitors can swivel, rotate, and tilt to adjust to your preferences.  You might find that you can increase your productivity without decreasing your desk space.

#3 Trouble with Email Attachments

If you are having issues with email, particularly opening attachments, you might want to look into a software upgrade. If your software is outdated, the files you are trying to open might no longer be compatible with what you are using.

#4 Printer Problems

These always seem to arise at the worst possible times, but there are a few quick fixes you can try.  First is simply turning the computer off and on, but if this doesn’t work, try unplugging it altogether and then plugging it back in.  You can also double click the printer icon on your computer to check the print queue and see if there are several documents waiting.

#5 Download Speeds

If your computer is taking way too much time to download things from the internet, you might check to see that you aren’t downloading or uploading things without knowing it.  Sometimes torrent programs run in the background of your computer and are minimized to your systems tray–without you even noticing them.

#6 Unreliable Wi-Fi

The first step when dealing with unreliable Wi-Fi is to check to see if your router or your computer is the problem.  If it is just a matter of improving the signal strength from your router, look into purchasing a Wi-Fi range extender, which can strengthen the signal from a router in different parts of a building.

#7 Laptop Upgrades

If you are frustrated with your laptop but still unsure of whether to make the leap to a tablet, consider some devices that are somewhere in between.  Many laptops with full keyboards also feature touchscreens that can rotate 360 degrees, giving you some of the best features of both options.  If you know you want to be on the go and work from something smaller altogether, then maybe downsizing to a tablet is the best option for you—look into your choices to see what will serve you best.

#8 Losing Power

Sometimes documents can be lost simply because of the battery dying on your computer—inadvertently erasing hours of hard work.  One way to prevent this from happening is to look into a UPS (uninterruptable power supply), which gives you time to back up your work before losing power.

Consider trying some of these tips if you are having tech problems in your office!

If your business is interested in office space for rent in Kansas City, give Kathy Woodward at DDI Commercial a call at 913-685-4100!


3 Terms You Need to Know Before Entering Negotiations for a Small Office Lease in Kansas City

Before entering negotiations for a commercial space, educate yourself on how negotiations work and the ways you can be a better negotiator.  Here are a few terms to know, as defined in the article “Develop Negotiating Skills”:

#1 Market Comparables

Market comparables are the prices of spaces in recent similar transactions.  By determining the market comparables for your space, you can have a benchmark to reference for what is roughly paid for those types of spaces.  You might use a commercial real estate broker to help you determine these numbers.  However, bear in mind that your landlord might make a case for charging a higher price than other recent market comparables if they believe a space offers added benefits beyond those other spaces.

#2 Pricing Power

Both you and the landlord might have pricing power, which is what distances you from competition.  For instance, a landlord might be charging a higher price for a space, but might still have more pricing power than another landlord with a lower priced space because they have established themselves as fair and reliable.  Or perhaps they are in a better location.  You might also have pricing power as a tenant if you have a history of long stable rentals or are a better fit with other businesses on a property than a competing tenant.  However, pricing power only goes so far in commercial real estate deals, because often prices are largely determined by the market.  Because of this it is still essential for landlords to try to offer the lowest prices.

#3 Deal Points

A deal point is a non-negotiable item that is make-or-break in agreeing to a lease.  Both sides usually come to the table with a few deal points, so it is essential to determine early on what these issues are for each party.  For instance, a landlord might insist on a certain type of lease, such as triple net, or adjustments to rent that take into account inflation over the years.  A tenant might insist on the right to sublease, or a provision that allows them to break the lease if an anchor tenant leaves the property.

An understanding of how negotiations work can help you determine what is truly a good deal for your business or when to walk away.

If you want to learn more about available office space for rent in Kansas City, give Kathy Woodward at DDI Commercial a call at 913-685-4100.


5 Tips for Protecting Yourself if You Need to Break Your Kansas City Office Space Lease

Even if you are predicting nothing but sunny skies and steady growth for your business in the coming years, sometimes factors outside of your control can unexpectedly affect your business. Because leases are a sizable investment of your time and money, signing a lease always carries a risk in the event that you might have to end it early because of bankruptcy, being bought out, or forced to relocate for some other reason—a worst case lease breaking scenario.

On the other hand, a lease could begin to hurt your business because of the unforeseen success and growth you are experiencing. A best case lease breaking scenario would be needing to move because your business has outgrown the space.

Here are some tips for putting your business in the best possible position in the event of having to break your lease for any reason, as explained in the article “How to prepare your business for the best and worst cases in a lease”:

  1. Subletting or Assignment Clauses. Try to negotiate for the right to either sublet some or all of your space to another tenant, or assign the lease altogether to a different party. This can majorly alleviate the financial troubles you might run into by ending a lease—for instance, if your business needs to relocate to a different space.
  2. Personal Guarantees. Pay particular attention to this part of a lease, because it is not favorable to you as a tenant, though you can often negotiate to get it to a more reasonable point. A personal guarantee makes you as a business owner personally responsible for lease payments in the event that your business breaks the lease. For instance, if you have a five year lease and you break it after two years, you will have to pay the last three years of rent from your personal savings. Read the fine print on your personal guarantee to find out what you are responsible for. Landlords typically ask for a guarantee if they are making a lot of adjustments to a space for your business, so see if you can only be held responsible for improvements that specifically will be used by your business, or ask if the amount you might have to pay could decrease as you get closer to the end date of the lease.
  3. Disability or Death Clause. This clause calls for the termination of a lease if the business owner becomes disabled or dies. This might be important if you are a very small business, such as a law firm with just one lawyer and a receptionist.
  4. First Refusal Rights. This clause means that a landlord has to offer spaces adjacent to your offices to you first before seeking other tenants. This could be good for your business if you need to expand because you will save time and money that would be spent on moving. However, there is usually a small window of time for you to take advantage of these offers, and often you have to either match or exceed another customer’s offer for the space, so don’t let yourself be pressured into adding the space if the terms do not meet your needs.
  5. Relocation or Expansion Clause. Putting this clause in your lease means that you can potentially move into another space the landlord has available in the event that you grow and need a larger space. The specifics of this clause differ from lease to lease, but be aware of the basics and ready to negotiate for this perk.

Unforseen boons and setbacks happen to businesses all of the time, and the best way to prepare yourself is by anticipating every possible scenario while negotiating your lease!

If you are looking at commercial MLS listings in Kansas City, give us a call at 913-685-4100 to find out more about our office space for rent in Kansas City.


Five Avoidable Mistakes That Can Hurt Your Office Space Lease in Overland Park

Leasing can be a complicated process, and it can be easy for an inexperienced lessee to find themselves in a bad lease because they were not aware of the mistakes they were making. Here are five mistakes to be wary of as you navigate the commercial leasing process, as suggested in the article “The Eight Mistakes Tenants Make When Leasing Office Space”:

  1. Weak Negotiations. Sometimes tenants think that what the landlords puts in a lease is immutable, but this is not necessarily true. The landlord’s priority is to fill spaces in the building, which means that he or she will negotiate and concede to tenants if they have to. Even small businesses looking to only rent a tiny piece of the building have power in a real estate market in which a lot of commercial rental buildings are comprised of many small tenants. So be aware that you have more leverage than you think and be tough in your negotiations.
  2. Not Reviewing the Lease. This seems like a basic step, but many tenants either do not read the lease carefully or do not fully understand everything that is in the lease. Be aware of things like notice periods and sublet and assignment provisions. Make sure these parts of the lease are fair to your business.
  3. Not Using Representation. Using a broker to represent the interests of your business can be hugely beneficial to you in the long run, despite the short term cost. Brokers understand the market and how to negotiate for a space. They can help you find a building that best fits your business and help you negotiate a lease that will be good for your business. Sometimes trying to go without this expertise can put your business in a position where you need to end a lease early—which is not a good thing. Consider hiring someone who truly understands the complicated world of commercial real estate.
  4. Hiring a Broker Loyal to the Landlord. Be wary of using a broker that represents both tenant and landlord, which is how brokers at big real estate companies often work. The appeal of these brokers is that they understand the leasing process from both sides, but they often tend to side with the landlord over the small tenant, so choose carefully when you are looking for someone to fight for your business’s best interests.
  5. Not Leaving Enough Moving Time. If your business has never moved before, you might have no idea how long it will take to pack up and relocate to a new space. Often tenants underestimate how much work this process is, and they do not leave themselves enough time to either find a new space or renew their current lease. It could take up to a year to work through the leasing process, or even more than that if you are a big company. Start the process well in advance so that you have plenty of time to find a good deal and move if you need to.

Educate yourself on the leasing process to avoid these mistakes!

If you are interested in office space for rent in Kansas City, give one of our commercial real estate brokers in Kansas City a call at 913-685-4100!


4 Words to Add to Your Kansas City Office Space Leasing Vocabulary

If you are getting ready to negotiate a commercial lease, go in prepared by studying up on your leasing vocabulary.  Here are a few words to be aware of, as listed in the article, “10 Commercial Real Estate Terms You Need to Know“:

Letter of Intent

An informal agreement between you and your landlord indicating that you are interested in beginning lease negotiations.  Strongly consider consulting a lawyer before signing a letter of intent.

Non-Compete Clause

A clause to consider asking for if you are in the service industry and hoping to stay in the space for a long clause.  This prohibits your landlord from leasing a neighboring space to a direct competitor of your business.

Escalation Clause

This clause allows the landlord to increase rent based on increase in the expenses they have to pay (i.e. taxes).  This can take the form of adjustments based on the CPI, increased operating costs, or periodic rent increases.

Full Service Rent

Rent that covers all expenses for the first year, such as operating costs and taxes.  You will still most likely be responsible for increases in operating costs over the base amount.

Before you enter lease negotiations, it is important to have a clear understanding of the language you will come across so you can negotiate the best deal for your business.

If your business is looking into office space for rent in Kansas City, give us a call at 913-685-4100 to set up a tour of an office rental space in Kansas City.


Tips for Being Courteous in Your Kansas City Office Space

Sometimes it is easy to become unaware of your surroundings when you are settled into a workplace and working hard, but it is important to stay conscious of how your daily habits are impacting your coworkers.  Here are some things to think about to make sure you are being courteous in the workplace:

  • Be respectful of others’ space.  Even if you are just in cubicles, be sure to knock before walking into a person’s space, or find some other non-disruptive way to make your presence known.  Wait to sit down until you are invited to do so.
  • Keep your space neat.  Your workspace is a reflection of you, so be sure to keep it clean and organized, with a few personal touches.
  • Do not interrupt phone calls.  If someone is on the phone, leave them alone—it could be an important call.  Do not interrupt their conversation or even try to communicate with them using sign language.  Wait until they are finished or come back later.
  • Follow accepted cell phone practices.  Know when it is appropriate to use your cell phone, and try to limit your personal calls.
  • Be courteous with food.  Try to eat as little as possible in your office space.  The noise of preparing food or the smell could be a distraction to surrounding coworkers.

Be aware of the culture of your office and try to be a courteous and pleasant coworker!

If your business is interested in an office space for rent in Kansas City, give a commercial real estate broker in Kansas City a call at 913-685-4100 to find out about our available spaces!


9 Tips for Keeping your Kansas City Office Space Organized: Part III

Check out these few final tips for keeping your office space organized and kick-starting your productivity:

7.      Keep Track of your “To-Do’s”:  Whether you do it using pen and paper or you prefer to keep track of your life electronically, maintaining a running to do list can help prevent things from falling through the cracks.  Divide your tasks into categories (i.e. by client or project), and make sure you include all important dates and deadlines for those tasks.

8.      Stay current with your communication:  One of the biggest mistakes you can make is ignoring communications from others.  Schedule yourself a time every day to check and respond to emails and phone messages.  Taking care of this once in the morning and again in the afternoon will get the job done and minimally interrupt your work flow.

9.      Organize your Inbox:  It is important to stay electrically organized as well as physically organized.  Make different folders and subfolders within your inbox for different projects and clients.  With this system, you can respond to a new email right away and then file it under the appropriate inbox folder.

Keeping yourself and your space free of physical, mental, and electronic clutter can help make sure that your workdays are more productive!

If your business needs an office space for rent in Kansas City, give a commercial real estate broker in Kansas City a call at 913-685-4100!


Understanding Tenant Improvements for Your Small Office Lease in Kansas City

Have you found the perfect space for your business, but just need to make a few improvements?  You might need to do anything from changing the flooring to upgrading the electrical wiring, all of these things are known as Tenant Improvements.

About Tenant Improvements
All different kinds of spaces might need tenant improvements.  You could be renting a completely unfinished space, called a shell space, or a space that is mostly unfinished but includes lighting and HVAC systems, which is called a warm shell space.  Standard space is finished, but could still potentially require improvements.  The last kind of potential space improvements are custom finishes, which could include things like unique designs or luxury or specialty materials.

Why You Should Negotiate for Tenant Improvements

From the perspective of a landlord, long-term tenants investing in improvements that will be useable for future tenants is a smart business decision because it will increase the value of the space and allow them to charge higher rent.  Therefore, if you are a tenant with good credit requesting general improvements, your landlord might be inclined to give you a Tenant Improvement Allowance or Tenant Improvement Credit, which is a fixed dollar amount given by the landlord to the tenant for improvements.

Don’t let a few improvement issues with a space prevent you from leasing it, talk to your landlord about your improvement options!

If you would like to learn more about office space for rent in Kansas City, give us a call at 913-685-4100 to learn more about our available office space in Kansas City


Time to Relocate to New Kansas City Office Space?

Many businesses at some point or another have had to ask themselves the question: should we relocate?  There are several different factors to consider when determining whether relocation is the smartest move for your business.  Here are a few things to consider if you are wondering if you should move to a new office space:

  • A cost benefit analysis – this should include not only the price difference in rentable square footage for a new space, but also the costs of relocating.
  • Advantages and disadvantages to accessibility and visibility for your current or potential customers or clients.
  • The distance between commutes – how long will it take employees to get to this new location, and will they be willing to make that change, or will you have to draw from a new staffing pool?

If you are fairly certain your business needs to move, another thing you might wonder about is how much time it should take to relocate.  Your time estimation should account for the following:

  • Getting the new space move-in ready
  • Packing and loading everything you need from your old office space
  • Transporting and unloading everything
  • Unpacking and settling into your new space

If you think that relocating is best for your business, advanced planning and a realistic time estimation can make the moving process run a lot smoother.

If you are considering moving to a new office space for rent in Kansas City and would like some more information about office space in Kansas or would even like to set up a tour, give us a call today at 913-685-4100.