Rent negotiations

[thecomputerguy]

Based on my previous post I was moved into a temporary office space while my office is now under construction due to unforeseen circumstances: https://www.technibble.com/forums/threads/its-been-a-week.90759/#post-761679

I have been displaced into a larger temporary office space for 2-6+ weeks that I'd like to stay in. My current office is 240sqf for $600p/m and I have been moved into a 408sqf office space right down the hall from my current space they are leasing for $860p.m.

I'd like to stay in the larger office space permanently. The only concession they have offered (currently) is a moving crew from A to B and from B to A. While my time investment to get back up and running will be between 15-30 hours of tear down and rebuild between both points.

I am grateful that they have provided this at the least.

They are usually reasonable.

I want to stay in the larger office permanently. I'd also like to not pay much more than I'm paying now for and office space. But the new space has a storage room for parts and equipment.

The location of the building is perfect regardless of what suite I end up in. If they say no to whatever I ask I will end up at the office I was at originally without issue because I WILL NOT change where I do my business because it is in a perfect physical location. It's 5 minutes from my house and in a quiet commercial area.

What would you recommend for me to stay in my current building while getting the larger office space given the circumstance?

Ultimately if they say no, then I just move back into my old office space that I am and have been outgrowing over the last 4 years because I will not move and they will provide a moving team to move me and I will need to setup from scratch again as I've already done.

They could literally say no thanks, and I'd just move back into my old suite but I want/need more space.

 

[thecomputerguy]

Update (I'm 4 months into a 3 year lease.):

 

[sapphirescales]

For an extra $260/month it sounds like a no brainer. If it's going to take you another 15-30 hours to move back, how much do you make per hour? How much is your time worth? Even if you only make $100/hour and it only takes you 15 hours, that's 6 months rent worth of your time. All I'll say is be careful. Once you increase your space, it's very hard to downsize, whether it's your house or a commercial building. I had the misfortune of buying a 5,000 square foot house with vaulted ceilings throughout. I'd love to downsize but everything just seems so small and claustrophobic. I never would have bought this thing but circumstances made it the right move at the time. If you move into this space, be prepared for that to be the minimum you'll need going forward.

 

[sapphirescales]

This applies to cars, too. Once you've had a Rolls Royce or two, everything else seems so... plebeian.

I wouldn't know. I drive a 16 year old car. I've never cared about cars. I once rode in a Tesla and while it was cool I can't imagine spending that kind of money on one, even if the issues with electric vehicles weren't a factor.

 

[callthatgirl]

Take the bigger space, try adding on a longer lease contract to help negotiate some discounts. If you need to grow and don't have space, you are trapped. Question...do they have bigger spaces available? If so, write in the contract that if a bigger space becomes available in time, when you need it, you can transfer lease agreements. When you give yourself more space, your brain thinks differently. Then you might need more in time, just a thought.

 

[YeOldeStonecat]

While I sit here trying to shake off the crazy CA high costs of...stuff....(you pay quite a high $ per sq ft...WOW!!!!).....is this the same "primary building or complex? Same land lord"?

If it is the same complex and same landlord...why not make an offer? How "hot" is commercial space where you're at? Do any units remain unleased? If so...you have leverage to make an offer. If they tend to fill units soon as they're available...you have less leverage. However...IT DOESN'T HURT TO ASK!

I consider where our offices are...to be an expensive area, higher tourist demand (Mystic Connecticut)...higher military industry (Coast Guard Academy, Electric Boat <sub builder>, the east coast Navy Sub Base. Also...big pharmaceutical (Pfizer), and ritzy coastal shoreline towns.
But jeeeeze..we're no where near that price per sq ft. The space we rent now...we have 6x suites in a complex, 3 of them are around 350 sq ft, 1 of them around 200 sq ft, and and 2 of them around 400 sq ft each. Plus an outside storage unit. We pay $2k/mo. When we started out, we had 2x of them, I think we paid around $600/mo for that ~700 sq ft. Electricity and heat/AC included.

ANYways....
Can you stomach the increase of $260?
Do you NEED the extra space?
Will...new ways of using the extra space help the business? Example...a nice conference room for meetings? Larger stock room...organize better, lots of products on the shelves to show clients/potential clients.
More "work space to get more work done faster"?

<45% increase in rent
~75% increase in space

I've been pounding the south west Florida area for office space, finally found my start space for our expansion office down there, in Placida FL. Nice professional complex with 8x tenants...so I'll have 7x other businesses I can pitch to "right away".
~600 sq ft for $850 plus tax. No additional CAM fees, a dumpster the complex shares, plenty of parking, a Yoga studio in there (for nice views. ) Good plaza signage to slide our rider in.

So at the end of the day, would you be "happy about it" if you got the place for what they're asking? So...offer a bit less. What is your history there? If a good history, offer a little less, like 8 hundge even. What's the worst they can say, "No"? If so...take it at their ask.

Also, how many other businesses there? We provide internet for all the tenants in our professional center. Even our landlords office..we make money back!

 

[Markverhyden]

Personally I'd start with a counter on rental for the temp space. Nudge it down a bit to an even $2/ft*2 for 4 years.

 

[thecomputerguy]

While I sit here trying to shake off the crazy CA high costs of...stuff....(you pay quite a high $ per sq ft...WOW!!!!).....is this the same "primary building or complex? Same land lord"?

If it is the same complex and same landlord...why not make an offer? How "hot" is commercial space where you're at? Do any units remain unleased? If so...you have leverage to make an offer. If they tend to fill units soon as they're available...you have less leverage. However...IT DOESN'T HURT TO ASK!

I consider where our offices are...to be an expensive area, higher tourist demand (Mystic Connecticut)...higher military industry (Coast Guard Academy, Electric Boat <sub builder>, the east coast Navy Sub Base. Also...big pharmaceutical (Pfizer), and ritzy coastal shoreline towns.
But jeeeeze..we're no where near that price per sq ft. The space we rent now...we have 6x suites in a complex, 3 of them are around 350 sq ft, 1 of them around 200 sq ft, and and 2 of them around 400 sq ft each. Plus an outside storage unit. We pay $2k/mo. When we started out, we had 2x of them, I think we paid around $600/mo for that ~700 sq ft. Electricity and heat/AC included.

ANYways....
Can you stomach the increase of $260?
Do you NEED the extra space?
Will...new ways of using the extra space help the business? Example...a nice conference room for meetings? Larger stock room...organize better, lots of products on the shelves to show clients/potential clients.
More "work space to get more work done faster"?

<45% increase in rent
~75% increase in space

I've been pounding the south west Florida area for office space, finally found my start space for our expansion office down there, in Placida FL. Nice professional complex with 8x tenants...so I'll have 7x other businesses I can pitch to "right away".
~600 sq ft for $850 plus tax. No additional CAM fees, a dumpster the complex shares, plenty of parking, a Yoga studio in there (for nice views. ) Good plaza signage to slide our rider in.

So at the end of the day, would you be "happy about it" if you got the place for what they're asking? So...offer a bit less. What is your history there? If a good history, offer a little less, like 8 hundge even. What's the worst they can say, "No"? If so...take it at their ask.

Also, how many other businesses there? We provide internet for all the tenants in our professional center. Even our landlords office..we make money back!

Personally I'd start with a counter on rental for the temp space. Nudge it down a bit to an even $2/ft*2 for 4 years.

The way they calculate is strange because it's technically advertised as $18sq/f but obviously 240sqf x $18.00 isn't $600 per month it's $360 per month but they do some funny math to calculate the communal spaces which includes 4 bathrooms (I'm not sure if I pay for mens and womens) and a kitchen/conference room. I don't exactly know how that funny math works out but bottom line is 240sqf is $600 per month includes everything (water, electric, HVAC, trash, dumpster access, security cameras, key card door security, a daily cleaning crew for common areas) internet which is $100 a month. I guess that comes out closer to $30 a sqf.

I checked with another tenant last night and his office is 224sqf and he pays $540 ... so were not that far apart. Market wise I have no idea about the commercial spaces I just know that when I was looking 3_ years ago this place was one of the cheapest and closest to home for me and still is. If I had to move from this space it would be devastating.

Do I NEED the space? No I have been getting by just fine until now since I didn't know any different. But during busy times, like now I essentially have no walking room in my office. I walk in the door have to hurdle over boxes to get to my desk. The ceilings are tall so I just stack UP now. It also doesn't help my mental walking in Monday morning into an office I can't move in, not to mention the fact that all that product is sitting in front of me staring at me all day everyday reminding me of all the work I have to do but can't for one reason or another.

The new office is larger and also has a separate storage room behind another door, so that's nice. Could be a great nap room too!

Briefly looking online other places are at $20-$25 at other places with or without funny math I'm not sure, what is and isn't included I'm not sure.

My current building is just about all leased out at the moment. There is only this temp unit I'm in now that is available and 2 others coming in 30 days-60 days.

It is hard to find spaces in the < 500sqf range for a reasonable price. Executive suites are too small and much more expensive and anything > 500sqf starts adding up quickly even if they are at market rate per sqf. Retail is an absolute no go.

 

[ThatPlace928]

If it were me, I'd look around at other spaces in other plazas and see if there's a better price out there, comparable to (or bigger than) the 408sf you are in temporarily.

I almost feel bad saying this but I have a suite that's only .3846 per sf. $500 for 1,300 sf. I have approximately 500 sf up front for displays, a work room off the hall roughly 100 sf, a large bathroom with a shower, and the back is my personal storage (or whatever space).

My son has the same deal in another suite 2 doors down from mine. We've been in our suites a little over 2 years now.

So far, no rent increases and, hopefully, it stays this way for a couple more years. My neighbor in the suite next to me says they haven't had a rent increase in 5 years.

The deals are out there. It just takes a little time and research to find the right one.

 

[thecomputerguy]

If it were me, I'd look around at other spaces in other plazas and see if there's a better price out there, comparable to (or bigger than) the 408sf you are in temporarily.

I almost feel bad saying this but I have a suite that's only .3846 per sf. $500 for 1,300 sf. I have approximately 500 sf up front for displays, a work room off the hall roughly 100 sf, a large bathroom with a shower, and the back is my personal storage (or whatever space).

My son has the same deal in another suite 2 doors down from mine. We've been in our suites a little over 2 years now.

So far, no rent increases and, hopefully, it stays this way for a couple more years. My neighbor in the suite next to me says they haven't had a rent increase in 5 years.

The deals are out there. It just takes a little time and research to find the right one.

Yeah but CA is a whole other animal. Do you pay for any utilities there or is it all included?

Well I'm locked in for another 3 years anyways I just re-signed in January ... there is a 1 year opt out so I might re-visit moving at a later date but the proximity to my home is paramount and for another $250 a month or essentially less than an hour and half of labor my life improves by quite a lot.

 

[ThatPlace928]

Yeah but CA is a whole other animal. Do you pay for any utilities there or is it all included?

Well I'm locked in for another 3 years anyways I just re-signed in January ... there is a 1 year opt out so I might re-visit moving at a later date but the proximity to my home is paramount and for another $250 a month or essentially less than an hour and half of labor my life improves by quite a lot.

I pay electric and internet and am 5 miles from home. I'm less than a 1/4 mile off the main highway, easy to find. I feel very fortunate to have what I have.

The main theme of my previous comment, however, was to simply look around and see what your options are.

If you find something comparable (or bigger) for the same money, you may be able to use it to bargain with, if you want to stay where you are.

 

[YeOldeStonecat]

The way they calculate is strange because it's technically advertised as $18sq/f but obviously 240sqf x $18.00 isn't $600 per month it's $360 per month but they do some funny math to calculate the communal spaces which includes 4 bathrooms (I'm not sure if I pay for mens and womens) and a kitchen/conference room. I don't exactly know how that funny math works out but bottom line is 240sqf is $600 per month includes everything (water, electric, HVAC, trash, dumpster access, security cameras, key card door security, a daily cleaning crew for common areas) internet which is $100 a month. I guess that comes out closer to $30 a sqf.

So you probably have CAM fees built into it all..(Common Area Maintenance)....ya know, options like shared thrones, shared kitchenettes, etc. So with CAM fees ...sometimes they just roll those in, or...in addition.
Typically gross vs net...usually for professional centers net is more common, where with single larger commercial buildings those may be gross.

 

[Your PCMD]

Well, I moved out of my building back in November. Why pay $20k a year when $15k got me this on my property?

 

[Porthos]

$15k got me this on my property

Glad you got the real stairs there. The first picture was an accident waiting to happen.

 

[thecomputerguy]

Yeah I gave up working from home a long time ago. Dogs, Kids, Wife ... too much commotion and too much equipment I have on hand.

That and we have don't have a lot of that thing you call LAND in California.

 

[callthatgirl]

@thecomputerguy yeah, if I had a hubs or family, I would def want to work outside my home.

 

[thecomputerguy]

Well we got in for $800 a month. I have been here for over 3 years so the property manager said I can cancel at any time with 3 months notice.

I'm enjoying my newfound larger space for aerobics

 

[Porthos]

I'm enjoying my newfound larger space for aerobics