Below is the first part in a multi-post series surrounding a typical Office Relocation. To read the introduction to this series or to view links of other sections, please click here.
For many companies the cost of leasing office space is typically one of the companies highest expense items – second to only the cost of salaries and wages – its important to be sure that both the move and the timing of the move are right for your company. Briefly, the relocation process contains:
- Establishing a relocation team to coordinate the move. This may also include an advisory team consisting of real estate and relocation professionals, a commercial real estate agent and real estate attorney.
- Determining your needs. How much space do you require? What type of building fits your business? What is your preferred geographic location? Do you need to be located near restaurants, hotels and/or public transportation? Lastly, you’ll need to prepare a budget.
- Identify potential properties. Obtain a list of available properties from your commercial real estate agent. Narrow the list by excluding properties that are unsuitable. Schedule a tour of the remaining facilities. Determine which locations could be appropriate for your business.
- Prepare a preliminary space plan. With the help of a space planner or architect, determine the most efficient use of space at your two or three top building choices. For construction cost estimates, establish a general type and amount of changes required.
- Develop a Request for Proposal (RFP). Your commercial real estate agent will prepare and distribute an RFP to the landlords of your top building choices. Based upon response, determine which space would be the best alternative for your business. Once determined, your real estate agent will submit a letter of intent to the landlord outlining the terms you intend the lease to be based upon.
- Finalize space plan. Get input from departmental representatives and have a formal blueprint created to represent your new space should remodeling/construction be necessary.
- Negotiate the terms of your lease. Once a lease is obtained and reviewed by decision-maker(s) from your company, get input from your real estate agent and attorney. Renegotiate and/or accept lease terms.
Now, having conceptualized the process, you’ll need to dive a bit deeper into the details required for planning your move.
- Identify dedicated resources. This should include a relocation coordinator and departmental representation. Each participant should understand occasional evening and weekend work may be necessary. The team should also plan to attend weekly progress meetings, once details begin to materialize.
- Develop an advisory team:
- ->Commercial Real Estate Agent/Broker:
Choose someone experienced in lease negotations and specialized in similar types of space (e.g. office, industrial, retail, etc.). Understand how he/she finds available space. Ask how this person will get paid for providing services. Also ask for 2 or 3 references of similar clients.
- ->Real Estate Attorney:
He/she should help in determining rights of both parties and understanding the significance of all lease terms. Should also recognize and leverage the goals of the business with those of the landlord.
- ->Architect/Space Planner:
Relocation is an excellent opportunity to design a more efficient working environment. This person can help in determining the correct amount of space required, taking into consideration current/future employees and growth expectations.
- ->Furniture Consultant:
If buying new furniture, bring a furniture vendor into the process to help with the type of configuration of workstations and individual office furniture. Design services are typically offered at no charge to you, depending on the type of and quantity of furniture ordered.
- ->IT Consultant:
This is crucial in helping to design and setup telephone/data services, esp. if you are planning to move significant existing equipment. Key considerations include building ample capacity for phone/data networks with appropriate access points throughout the new office. This resource may also be helpful in coordinating external vendors, such as utility providers, ISPs, phone companies, etc. and renegotiate contracts.
- Determine the budget. Consider the costs of professional advisory fees, hiring a moving company, relocating your equipment and computer network, replacing office furniture and printing costs for new business cards, stationary and other printed material, including relocation announcements for customers.
- Establish a Time Line. A typical move can take anywhere from six to 12 months of planning. In general, your facility selection and lease review process will take the longest amount of time. It’s important to continue working through other facets of the move, choosing a moving company, researching furniture options and office equipment during the facility selection process.
- Key Considerations
- Evaluate the feasibility of renewing your current lease before making decisions to relocate. If you choose to move, interview several commercial real estate agents. Be sure to check references as well as companies/properties they represent. Establish a moving date well in advance, ideally in less busy period of the business to ensure ample time for the relocation process.
- Action Steps
- 10-12 months prior to the move you should: Appoint a relocation coordinator, interview and select a commercial real estate agent, engage services of a real estate attorney, select the rest of your advisory team including an architect or space planner as well as furniture and IT consultants. Next develop your relocation budget, including estimates for professional services, moving expenses and the cost of new furnishings and equipment. Lastly, schedule the prospective moving day, knowing that this may be a moving target until the office space selection and other factors are determined.
Next, we’ll dive into part 2, creating your ideal office environment.