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How To find affordable office space

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The type of business and the needs of its customers play a key part in location choice

by Ann Bucy

SBJ Contributing Writer

Tom Rankin, CCIM, has been in the business of helping people find office space for the last 10 years. The owner of Rankin & Company LLC suggests that anyone looking for a new space work with a commissioned real estate broker.

"They know the market; you're getting the services of a professional and, typically, there's no additional cost because the listing agent splits the fees with the tenant's agent," he said.

When seeking out the right office space, Rankin said he believes it's important to first analyze a company's space needs.

Determine what your square footage needs are going to be now and in the future. Understand your floor plan needs if there will be supply, break and conference rooms, a reception area, etc., he said.

Then look at the location what part of town you want your business in. Consider whether you mostly travel to other businesses or if they come to you, and how far out you're willing to go in any direction, Rankin said.

"Some people have specific guidelines, like, 'We won't go farther west than Campbell Street' or 'No farther north than Kearney,'" he said.

Location includes looking at what kind of image the company is trying to communicate to the public. Is it a Class A image that includes things like an entryway and formal reception area, or location in a newer building? How prominent do you want or need the location to be? In other words, how important is visibility?

Another issue is parking. The location of parking is important (is at-the-door parking available?), but the amount of parking is also vital. "I think that a business like a dentist's office, for example, should plan for more parking than an advertising firm," Rankin said.

Also look at what amenities the building has for example, is there an exercise room, fiber optic capabilities, food service either in the building or nearby?

And, of course, a lot depends on the bottom line, Rankin said. What's your budget? What can you afford to pay for rent, common area charges like lawn care, trash and snow removal, parking lot maintenance, exterior lighting, utilities and real estate taxes?

What costs, if any, is the landlord passing on to you? Will you be looking at new or second-generation (previously occupied) space? Who's responsible for remodeling costs you or the landlord?

Rankin added that the best thing to do when trying to cut costs is to consider settling for a less desirable location, such as a second-generation space.

Mark Harrell, president of Plaza Realty & Management Services Inc., said he believes that after you've defined your budget and found a space you like, it would be wise to lease the space.

"Sometimes you'll lose the opportunity to lease in trying to unreasonably save dollars," he said. "If you find a location that works and you would enjoy working at the property, then it's probably met two very important qualities."

Harrell said he believes that when looking for retail space (grocery stores, book stores, clothing stores) the most important criteria are location, location, location.

"The biggest mistake a retail tenant can make is an inferior location based on saving rental dollars," he said.

According to Harrell, there's a wide range of facilities available, from Class A to Class C. "Class B and C are not clearly defined," he said. "With B, the location is less than superior, the facilities are older or haven't been well maintained and are not on the level of a Class A building. A Class C building is another step beyond that."

But when you're looking for office space or a building for service or manufacturing type companies, Harrell said, location isn't as important.

"A manufacturing or service space needs to have good roads coming in and out of the area because a lot of heavy equipment will be passing through. Utilities are important, as well as having the zoning area appraised," Harrell said.

When considering location, "It's important that an office space be convenient

to customers if the public comes to you," he said, as in a doctor's or lawyer's offices.

"But if it's a back office, like a telemarketing company, than it's probably not

as important a consideration. You must give your business an opportunity to succeed by providing ample parking, exposure, traffic visibility and the demographics friendly to your business," Harrell said.

INSET CAPTION:

Location includes looking at what kind of image the company is trying to communicate to the public. A retail business has different location needs than a manufacturer.[[In-content Ad]]

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