Did you know that in 2020, the global market size for commercial real estate was almost $33 trillion? In the preceding 12 months to quarter two of 2021, this is the only sector in real estate that saw a positive rental growth of 3.2%.
With these statistics, you can tell that commercial space for rent is significant for businesses. It helps to give their retail stores space to jumpstart their businesses as they complement their online stores.
So, you need to carefully consider and plan when choosing the commercial space for your business. If you sign the lease after randomly picking a space, you might end up short-changing yourself. Over time, you might discover that it is not suitable for the requirements of your business.
Some of the factors you must consider before signing the lease include:
- The cost of renting or purchasing the building
- The type of location of the office space
- The size of the commercial space
- Whether it must be in the retail, industrial or commercial area of the city.
- The amenities if they fulfil your company’s operational needs.
Remember that any mistake you make when choosing may be costly for you in the long run. For instance, a small commercial space for rent may be ideal for your business compared to shared space.
This is because your business demands will increase in the near future, and you might need to add more desks and office equipment. Therefore, this might force you to move to a more private and suitable commercial space for your business needs.
Moreover, this rushed decision may have a significant negative impact on your firm’s bottom line. This article covers some of the factors you need to consider before signing the lease papers.
Understand the Nature of Your Business
The business you’re running will define the suitable commercial space for you. So, ensure you look at the retail spaces available in the following areas:
- Shopping centres.
- Industrial areas.
- Office buildings.
- Business parks.
- Commercial avenues.
However, the suitable retail space for you is dependent on the current business that you’re running, and its future needs.
So, you must carefully examine the nature of your firm and possible future expansions before you decide. This will help you create a list of everything it requires to succeed.
- Retail enterprise. If your business is on a growth trajectory, then you might want to consider a small commercial space for rent. Most companies just starting or looking to expand can benefit from these spaces. You can find these spaces in shopping centres or downtown stores. Other unconventional spaces that may work include standalone commercial structures, airports, transient event kiosks, etc.
- An office spaces. Commercial business spaces are ideal for office premises if your business does not rely on direct consumer traffic.
- Industrial business. If you’re running a manufacturing company, then you must look for locations that have massive storage spaces and convenient access to transportation routes. These businesses frequently need a particular set of utilities that meet certain requirements according to their documentation.
However, you must keep your company’s corporate identity in mind when making these choices. For instance, imagine claiming your spa offers luxurious services, but it’s in a rural area. This is not a good option as its location doesn’t match the description.
Size and Layout of the Retail Space
The type and scale of your business will help you determine the size and arrangement that will work for your setup. For instance, you can’t compare the space needed to operate a clothing store with a call centre.
A good way to determine the size that would be ideal for your business is by using the following calculation:
Size of Selling Space = Gross Sales Volume ÷ Sales per Square Foot.
It will give you a rough idea of whether you need to go for small business space for rent or a large one. Besides looking out for the comfort and convenience of your employees, some laws have specifications you must follow.
Also, you must factor in your future goals for your business when selecting the size of your commercial space. For instance, going for a larger space is advisable if you have plans for future expansions. This can be cheaper and more convenient than moving your business to a new site.
Moreover, you must also consider the area’s layout when selecting the ideal retail space for lease. Sometimes you may find that your business has unique furniture and equipment that properly fit a precise layout to operate well.
For instance, when setting up a warehouse, you may not necessarily need a reception area and a conference room for meetings and presentations. That said, in most cases, a conference is a must-have in an office setting.
Choose the Right Location for Your Commercial Space
Location is everything when it comes to business. With the wrong location, you won’t maximise your business profits. Therefore, this step is crucial when choosing a commercial space for rent. You must ensure you explore all the available options regarding the location in the market.
As you pick your location, you must remember why you’re opening a physical location. One of the main reasons you’re giving a business a physical landmark is to make a good first impression on your customers.
It’s crucial to ensure that the location of your retail space can match the brand image you’re trying to portray. As much as it will pay off in the long run,r a prime location is not a necessity. What’s vital is ensuring that your retail facility has good access to public transportation for your staff and customers’ convenience.
That said, it is best that it is conveniently located, well-connected, and offers at least a few top-notch dining and drinking establishments.
Moreover, you must ensure the location has spacious parking available. Parking space is essential as it is convenient for your customers and personnel.
You must also consider your line of business when choosing your retail space location. Let’s say it serves a majority of delegates. In this case, you may want it to have direct and convenient access to an airport.
Moreover, you need to ensure that the area is welcoming and safe. This is crucial for your employees, clients, and company security. So, after finding the ideal location for your retail space, you must now scout for the possible competition you may encounter.
Suitable Amenities for Your Business
It is critical to closely examine your business before signing the lease. What type of amenities and infrastructure will suit your business? This is crucial when selecting the ideal space for your business.
You may want to avoid older buildings as they may not have the appropriate infrastructure for high-tech activities. Therefore, you must pick a building with sufficient electrical, air conditioning, and telecom demands.
It is also ideal if the space you lease can meet your future needs besides satisfying your current level of operations. So, it’s advisable to work with an engineer to test the amenities of the building before you make a decision.
After ensuring the infrastructure and amenities in your building are properly functioning, it’s time to consider the nearby amenities. Before settling for that commercial space for rent, you can also consider the following nearby amenities:
- Banking facilities.
- Grocery stores.
- Post offices, etc.
You can’t ignore these essential facilities if you want to work with your team for a long time. You want your employees to feel like they can settle and start a family while working for you. That’s why a reputable neighbourhood is ideal for your employees to rent or buy homes.
Additionally, a busy neighbourhood with sufficient amenities is essential for your business. This gives you confidence that the nearby amenities will help drive foot traffic to your business, especially if your business depends directly on retail customers.
The interior design or fit-out for the retail space for lease is also essential. You can scout for buildings with ample natural light, vegetation, open windows, and excellent ventilation.
You Need to Understand the Property Documents Before Leasing the Space
Signing the paperwork is another crucial step you must consider during your commercial space hunt. Ensuring that you sign a purchase contract or a lease agreement if you’re buying or renting the property is vital. It is also best to consider all the other legal documents your state requires when leasing or buying a property.
But before that, you must engage a reputable property lawyer, real estate broker or legal counsellor when reviewing the terms and conditions before signing the paperwork.
This is crucial as it will help you clarify any doubts about the property. You can verify if there are any hidden costs, legally obligatory provisions, or extra fees.
Therefore, it is best if you request a copy of the lease agreement from the property owner several days in advance. This will give you enough time to review it thoroughly and spot anything you might have missed.
Finding a retail space for lease that meets all your needs for accessibility, budget, layout, size, and amenities is challenging.
But ensure you plan in advance so you can easily complete this process. Establish a practical plan to make things easier when looking for an ideal space for your business.
You must always work with your type of business and brand image in mind. It will help you select the ideal size and layout, consider the right amenities, and carefully review the lease or contract’s terms.
But above all, you will need patience and enough time before choosing a commercial space for rent. Finally, you may only sign the lease agreement after engaging with an experienced real estate attorney.