When a company is ready to move to a new office space, it will stir both excitement and trepidation among management and employees (and perhaps even customers). If a midsized firm's executives take into account all the factors that determine which space is truly right for operations, they will minimize worry and maximize enthusiasm. What's more, they can also boost the firm's long-term competitive and financial position.
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Here are four factors to consider when you start thinking about relocating:
1. Location
Unless you want to upset your employees, consider their concerns right from the start. Commute time is important, as is cost. It's imperative to determine where all employees live in relation to a new office. Consider sufficient parking, too, unless the new office will be located somewhere with adequate mass-transit options. If some employees can occasionally work remotely, it widens the geographic possibilities while reducing the amount of space you need.
Next, the neighborhood must be desirable to employees — and clients, too, especially if the business routinely hosts guests. The area should be safe and have enough retail services nearby to accommodate people's needs. These considerations affect present employees' satisfaction and color prospectives' decisions on whether they'd want to work for your company. Lastly, executives must determine whether it's important that the firm be located near its biggest customers or at a healthy distance away from particular competitors.
2. Features and Amenities
Midmarket leaders who seek the best rental rates must learn about each potential space's efficiency. For instance, one space equal in size to another might be 10 percent cheaper per month, but it also might have 20 percent rendered unusable for business purposes because of hallways, bathrooms or elevator lobbies. If the other space has only a 15 percent load factor, or the percentage of unusable space, then each location's value to the firm will be much closer in comparison.
Further, total cost of occupancy is affected by the building's condition and the strength of its technological, mechanical and human support systems. If a firm requires a significant fiber-cable system, then buildings without this feature should not be considered — especially because retrofitting is expensive. Additionally, if a firm has, or will eventually have, power needs that are beyond what is typical, then it must assess whether the electrical infrastructure is sufficient and cost effective. Because the top complaint of commercial-building tenants relates to heating, ventilation and air-conditioning (HVAC) issues, any space with an outdated HVAC system that's expensive to retrofit should not be considered.
As for the human factor, repair and janitorial contractors can be vetted through direct interviews, or by asking present building tenants. Prospective tenants can even interview those in other buildings who use those same contractors.
3. Property Management
Given that the new space's property manager will be nothing less than a partner, the relocation committee should interview present tenants about their relationship and experiences with that person. If present tenants cannot speak to the property manager's and supporting colleagues' responsiveness, then the prospective firm should have reservations about occupying space there. However, if a company finds the space highly desirable, it could negotiate a contract containing specific time frames and stipulations for action, along with remedies or penalties for when the property manager fails to act in a timely, adequate manner.
4. Price
As critical as monthly cost is in the search for new office space, midsized firms should keep the range of possibility as wide as possible. The reason: The factors described above dramatically affect your return on investment. A firm might decide to move in where monthly rent is 15 percent more than its present space, but with reduced turnover, acquisition of strong new talent, reduced ancillary costs, improved reputation and increased sales, the space could generate savings and revenue well in excess of that additional cost — and within a short time, too.
There's one more thing a midsized company must include in its comprehensive assessment: If the firm exceeds its performance expectations in the next few years, will it outgrow the new space? It would be unfortunate to interrupt a successful organization's momentum by having to go through the entire relocation process every few years.
Has your company ever relocated? How long did the process take, and what were your primary considerations when picking a new space? Let us know by commenting below.
Rob Carey is an NCMM contributor and a features writer who has focused on the business-to-business niche since 1992. He spent his first 15 years at Nielsen Business Media, rising from editorial intern to editorial director. Since then, he has been the principal of New York-based Meetings & Hospitality Insight, working with large hospitality brands in addition to various media outlets.