“Tips For The Office Space For Rent Businesses”
Looking to earn money from the unused spaces in your property?
Then you are not alone.
Many property managers and owners look to maximize the profits by using untouched and empty spaces on their property. And so they often turn those spaces into an office space for rent.
Renting an office space has now become a trend in the real estate business. It’s an answer to the problem of the increasing demand for office spaces, while also improving rental space profitability.
If you are interested in earning money from the unused spaces on your property, let me tell you how this type of business works.
In today’s blogs post, we’ll talk about the advantages of renting out the empty and unused spaces, and how to implement office space for rent in your building.
Things To Consider In An Office Space For Rent Business
When managing commercial properties for rent the main goal is to have your buildings 100% occupied with rental tenants.
Sometimes the only way to accomplish 100% occupancy is to offer individual office space for rent to commercial businesses.
As a property manager when determining how you want to rent out your commercial properties you should be careful in making decisions on profitability and demand for offices and commercial space in your area. When considering office space for rent you need to be able to accommodate your commercial business clients as well as make the office space rent usable and easily accessible for their needs.
Before deciding to turn your commercial buildings into office space rentals you need to learn how it works and knowledge of the basics is important.
So let’s start with knowing “what is an office space” first…
What Is An Office Space
An office space is generally a room or a designated space in a commercial building where administrative and business related work is done. A small area or space in a room can be called an office as long as it can provide a suitable environment for business operations.
Small offices are often used by small businesses to accommodate their operations.
The term ‘office’ usually refers to the physical location of an area designated for work by a commercial company and is normally located in a commercial office building. Typically, offices are inside commercial buildings where white-collar workers [[[link to wikipedia definition]]] are employed.
An office is considered a business’s asset and it is dedicated to the direction and coordination of its various activities. The office is used to run a business which is why an office is a special part of every business.
If a business is expanding it will usually look for empty spaces to rent and turn it into office space and office use. Since the industry of office space for rent is increasing along with the demand for empty office spaces in commercial buildings commercial property managers must grab this chance and take a look at the advantages of renting office space.
Advantages Of Renting Office Space For Business Owners
Turning the empty and unused space on your commercial property would be beneficial in both uses and profitability. In fact many property managers are following this trend in the real estate industry of converting empty or unused space on your property and setting it up for office space for rent.
There are several advantages to landlords when they take advantage of an office space for rent arrangement.
Having office space for rent gives property managers and landlords the opportunity to work with more commercial tenants and offer longer terms of the lease for these businesses. Usually, business tenants tend to avoid relocating their businesses because it would slow down their business. So the opportunity to sign and secure longer commercial leases with these tenants is increasing and is desireable.
The common length of term of the lease for tenants that are business owners ranges from 2 to 3 years. Attracting businesses to sign longer term leases of 5 to 10 years allows the business to have more stability and not have to worry about relocating anytime in the future…
As a property manager, you always need to be aware of when leases begin and end for your commercial tenants. When the lease contract ends there’s a chance that the tenant would extend to another year or opt to go to a month to month basis which allows you to find new business tenants that want to commit to longer term leases.
Profitable Amount of Rent
The laws regarding the amount of rent you can charge for commercial properties are different from residential properties. Rents are normally based on demand in the area for the commercial space for rent that is available.
When a commercial tenant has a month to month or a shorter term lease, unlike residential properties, the landlord or property manager could raise the rent anytime. This is especially the case if their tenant’s business is growing. Of course, an increase can only be done within the limitations of the commercial lease agreement they have signed.
Since commercial businesses are looking for a stable place to operate and locate their business, they are more willing to lock in rents and pay a premium for office space for rent and the ability to keep rents at a set amount during the lease agreement.
Longer leases and commercial businesses that are willing to commit to staying at your commercial property for longer terms will increase the demand and profitability for any office space for rent that occurs…
Get Improvements on the Property
Since the tenants are operating their business in the rented space most of the time they will negotiate in their lease agreement to alter its appearance to accommodate their type of business.
Your commercial business tenants could negotiate the following:
- change the paint
- replace or improve utilities
- renovate the whole office space that they are renting
As the property manager negotiating the lease agreement you have a great advantage on determining who will pay for alterations and the amounts of rents you can charge for the office space for rent.
When negotiating lease agreements you should be careful when it comes to allowing too much alterations and improvements on the rented property. The constructions and continuous alteration on the property could disrupt your other tenant’s businesses.
Unlike in a residential property, there is no set limit on how much a commercial business has to place as a deposit to rent a commercial office space. The commercial deposit can be part of the agreement to move in and the property manager can take whatever deposit is agreeable with the tenant. There’s no law regarding the specific amount of security deposit in commercial properties.
If something bad happens or the tenant have violated a term on the rent or lease agreement the property manager can take the improvements done by the tenants on the office space for rent as part of the collateral.
Whenever you are accepting new tenants it is advisable to require them to sign an agreement that makes them responsible to any damages caused by their business.
For Business Owners
Your tenants (business owners) also get benefits from office space for rent. Renting an office space allows business owner tenants to use buildings that have a good image, and are well used and maintained..
An office space for rent allows business owners to free up their capital. And since they’re only renting the place, the business owner will be free from the problems of owning a property.
Important Aspects To Check Before Starting An Office Space For Rent Business
The office space for rent business is beneficial to most property managers and owners.
However, before you start your own office space rentals, review the follow important aspects before starting an office space for rent business.
Check Your Location
Before you start your office space for rent business, make sure that your property is near your target clients.
Since your property will be used by white collar workers, your tenants will be looking for a building that can offer convenience. Take your time to consider if your property is far away from your target clients or busy streets.
A long commute or trip to your property could drive potential tenants away.
Since you are leasing the free space in your building, expect to have more visitors throughout the day.
Potential tenants may check the available parking of the rental property.
Parking may be one of the biggest areas of concern for both your tenants and their clients.
If your property lacks parking space, consider renting a vacant lot near your property and turn it into a parking area. Remember that your tenants are likely to leave your building if it has not enough parking.
Final Tips For Property Managers
It’s a good idea to check out the local competition before you start a business. Understand the competition so you can exploit their weaknesses and your strengths.
Know how the office rental industry works in your area before you start your own office space for rent business. Even if you have experience in doing business, it’s still advisable to learn from other businessmen or mentors in the target area.
Don’t expect to get advises from office space for rent business owners near you (the competition). Consider meeting other business owners just outside your area, and ask how can you gain an advantage against your competitors.
Be sure to trade experiences as much as possible.
Final Thoughts About Office Space For Rent
In today’s blog post, we talked about having an office space for rent. We discussed the benefits of turning an empty space in your property to an office space for rent.
Making use of the empty and unused spaces in your property can improve your the property profitability because demand for office spaces is ever increasing. But before you start an office space for rent, make sure to follow the tips given in this article. Take the time to understand the advantages of an office space for rent so you can decide if it’s right for you.
If you have questions, you can leave them at the comments section below.
1. Insurance Obligations Of Tenants When Leasing A Commercial Property Rental
2. How To Select The Best Landlord Association
3. Learning About How Tenants Should Make Alterations To A Space For Rent
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