Coworking spaces can be the perfect solution for a variety of working scenarios — from a solo entrepreneur just starting out to an executive from a large corporation seeking a change in scenery. Much like the businesses they serve, no two coworking spaces are the same. In fact, there are many aspects to consider when selecting a coworking space, including amenities, cost, location and clientele.
Assess Productivity Pitfalls
When searching for a coworking space, look for one with an atmosphere that is conducive to your individual company’s productivity. Since there will be many people working in close proximity to your “office,” your employees could become distracted. Take a look around the space before signing a lease to see what other businesses are doing and whether or not their day-to-day work is too loud for you and your staff.
Check Networking Opportunities
The professional composition of the coworking office is another factor to consider, as networking can be a large benefit. A space full of professionals from different industries can expand a network fast, providing a budding business with new opportunities and ideas. Many coworking offices host happy hours, workshops and other events to build and foster relationships among tenants.
Investigate Growth Potential
The amenities a coworking space offers can really set it apart from the other options. While a brand new startup may be able to get by with a desk and laptop, a growing business needs additional technology, storage and multiple desks. Young companies expand fast, so make sure the selected coworking space can accommodate a little growth until the business is ready to lease its own office. Additionally, the space should be able to meet the needs of the company, such as meeting rooms, private booths, printing and other professional necessities.
Coworking spaces offer leases with much shorter terms than traditional office spaces, but that doesn’t mean you should rush in to sign. Request a day pass so you can ensure it will be a good fit. Pay attention to the amenities, the other tenants and what the space may be lacking to ensure it meets the needs of the business. This is the time to uncover potential problems, such as Wi-Fi reliability or overall space maintenance.
Conducting thorough due diligence prior to signing a coworking lease is critical, as the office will play a large role on the productivity of a business. Create a list of what is essential to the company, and verify the space can meet those needs. Selecting a coworking office may seem like an easy decision, but it should be taken seriously, as it can either improve or harm productivity.
The latest movement in office design is uniting the benefits of both the open floor plans and private offices. Emagispace reached out to Bill Himmelstein for advice on how to balance the two designs to create a space that promotes independent and collaborative productivity.
Read the articlehere.
Before signing a lease, you want to make sure you are happy with the terms for the entire lease duration. To do this, you must understand the internal pieces of a lease so you can negotiate favorable terms with the landlord.
- Right to Terminate: This section of the contract describes what will happen if the contract is ended early or defaulted on, and describes the conditions for termination. Either party has the right to terminate the lease for a variety of reasons. However, one source of power you can ask for is a break clause which permits the tenant to terminate the lease without being obligated to pay the remaining rent balance should there be a timely notification of the intent to leave. This can be a great source of leverage to restructure a lease regardless of how the market has changed since the inception of the lease.
- Surrender of Premises: A surrender of premises clause stipulates the conditions of how the premises should be returned to the landlord and what procedures to follow when the lease ends. The clause outlines the tenant’s obligations, the landlord’s rights and what happens to any property left behind. It is acceptable to negotiate for the space to be returned in broom clean condition, and nothing more. The landlord may ask for space to be returned to white box condition, but that is too much to ask.
- Gross Lease: A gross lease is a type of commercial lease where the landlord pays for the building’s property taxes, insurance and maintenance. The gross lease can be modified to meet the needs of a particular building’s tenants, and a gross lease may require a tenant to pay utility bills. It’s important to make sure capital improvements are not passed along to tenants through operating expenses. When negotiating a gross lease, the tenant should ask which janitorial services are provided, and how often they are offered. The benefit of a gross lease is the convenience for the tenant to forecast a static expense.
- Insurance requirement: The insurance requirement of a lease defines the lease provisions of specific insurance coverages, indemnity, restoration, self-insurance and subrogation. What makes this negotiation difficult is the ever-changing terminology and coverages of insurance. It is recommended that you have a qualified insurance broker review the coverage requirements.
- Damage or Destruction Clause: A damage or destruction clause in a lease agreement outlines the rights and obligations of the parties to the lease in the event that the leased premises are damaged or destroyed during the term of the lease. Seek to minimize the time in which the lease can be terminated, and maximize the remedies available for the tenant.
Understanding the different terms, clauses and definitions of a lease is half the battle of negotiating a favorable lease. Make it as easy as possible to weave your way to a tenant-friendly lease by knowing the different pieces of a lease to even the playing field.