Yes and No.
In theory, yes:
The larger company”…
- Has more leverage over the landlord
- Represents a larger share of the building’s cash flow and profit
- Gives the building a higher occupancy, allowing them to charge more to other tenants
In addition, the better the reputation a company has, the more other tenants will want to follow them into the same property.
However, in reality, no:
Size shouldn’t matter with the right broker who is truly representing your best interests.
With a smaller company, the similar benefits are possible through a pro-active and strategic approach.
If a company is smaller, it is important to first get hold of a trusted and recommended real estate broker or negotiator who knows the business. The broker will have the experience required to compare prior deals made by larger companies in the building, and most importantly, the broker will care about the client’ best interests and negotiating the best deal possible for all of her client’.
Because the broker has significant information on the matter thus providing the client with the leverage needed, the client will get a result just as good as a large tenant that has an “˜importance in size’.
With a solid broker who has the best experience and knowledge, and who cares about the client, a small company can have the best deal, regardless of size.
TAG helps to relocate many companies every year saving them time, money, and hassle. Here is a relocation checklist so you can be sure you have everything covered for your next relocation.
____ Have movers come out to premises and do a walk through to determine relocation costs. Give a basic idea of what items need to move, any equipment or funiture that has to be taken down or taken apart in one location and put back together in another location.
____ Schedule time for freight elevators and docks at old and new locations.
____ Identify and secure insurance requirements.
____ Have phone and data broker arrange for telecom to be set up at new location and canceled at current location.
____ Contact furniture vendor to make sure all needs are taken care of.
____ Any sensitive items such as bank statements, contracts, invoices, client information etc need to be separated and either filed in another area of the office or if need be shredded.
____ Prepare an inventory of everything being moved.
____ Prepare change of address- notify post office, prepare business cards and stationary, send move notification to clients and vendors, change periodicals, subscriptions, and bill pays to new address.
____ Throw out all materials not essential to be relocated. May need to arrange for additional trash removal, charitable donation pick up, or coordinating off-site storage.
____ Communicate clearly with staff and movers so everyone is on the same page with how to prepare and label the belongings and what to expect with the new location.
____ Decommission old space. Get rid of unwanted furniture and equipment. Bring space back to what the lease terms specify- broom clean condition is typical.
Like anything, you should have a good team around you to help facilitate this process. Your broker should have key contacts in each of these areas that they can introduce. Always be open and honest about questions and concerns you have throughout the process.
A couple days ago, I had an interesting conversation with a business owner who was looking to renegotiate his office lease. He told me he is currently working with a business consultant to help him to do this. I thought, Wow! Hold on, a business consultant?
The word “˜consultant’ can easily be misleading and tricky. Consulting is the right motive, but a real estate consultant is the right specialist.
The difference between a business consultant and a real estate can be seen here:
|1. Business Consultant||2. Real Estate Consultant|
The more experience the better: When it comes to dealing with your second largest expense–like an office lease–it is critical to reach out and recruit the person with the most information and skills in negotiating leases.
Example 1. Renegotiating a lease using a business consultant:
The business consultant speaks directly to the landlord and asks what his best offer is. The business consultant then shares this information with the client who then calculates their best offer. The business consultant, who has no outside sources to compare prices of office leases, “negotiates” a price with the landlord. The landlord, aware that the business consultant has no outside information, has the upper hand. On top of this, the business consultant charges the client, who was left with poor results.
Example 2. Renegotiating a lease using a real estate consultant:
Clients first: The real estate consultant first asks the client what their intentions are.
The more information and knowledge, the more skilled the negotiator: The real estate consultant researches other buildings in the area, compares lease prices and shares this with the client.
The client then has the choice and upper hand to renegotiate the lease with the landlord or change offices. The landlord is now aware that he/she has competition and is more willing to seriously renegotiate the lease.
In addition, with a real estate consultant, the client owes nothing! The landlord compensates the broker.
The business consultant may have results but unsatisfying results. If you want the best results, think competition, think high savings, and get a real estate consultant.