29 Jan How to Source and Sign a Lease for London Office Space, Fast.
Any business owner knows, time is of the essence. Especially when you’re expanding and trying to source office space in London. Commercial real estate moves fast in the capital, and if you’re not working with a property broker who fully understands the market, you can find yourself (and your business) missing out.
When it comes to investing in commercial property, you need a broker who will add value and give you piece of mind. Someone who will not only source property, but also understands and explains leases, can negotiate contracts, supports you as a business owner throughout the whole process, and most importantly, will get the job done efficiently.
When it comes to sourcing and signing a commercial property lease for office space in London, the process can get complicated. Especially when you’re not a real estate expert yourself. So, when this is the case, how can you tell if you’re working with a property broker who is working at the highest level?
In order to help you ensure that you’re headed in the right direction; here are the key things your property broker should be discussing with you, when you’re preparing to invest in London commercial real estate.
1 – Your Main London Office Space Requirements
It is unlikely you will find the perfect property, with the ideal lease for your business needs at the price you want to pay, straight off the shelf! Which is why lease negotiations are so commonplace. Before you start your search, and then any resulting negotiations, your broker should be acutely aware of your needs and requirements and include this in your action plan. This way you can be sure they’re aren’t wasting precious time and are working to only deliver the commercial property that will work for you, your brand, your employees, your firm.
2 – Commercial Lease Length
No two leases are the same, but in general you can expect leases for office space to start at around 5 years. For some smaller businesses and startups, whose future may be unpredictable, this can seem like a high-risk commitment. If this is the case, your property broker should know to negotiate a few aspects to take this pressure off, such as a break clause or the ability to sublease. At Stonelink International, we may even guide you to steer clear of taking on a long term lease where we see uncertainty in your ability to meet key obligations and advise you to start off with hot desking or co-working.
3 – Commercial Lease Payment Terms and Conditions
Before you sign anything, make sure your property broker has fully explained all the conditions of payments surrounding the lease. You should be discussing; the frequency of rent payments, when and how to pay, deadlines, additional charges and any penalties that could come into effect. Furthermore, request details of building insurance costs, demised electricity or gas costs and if the location of the commercial property is in the UK, with London as the city, the london broker must be able to advise whether there are any Parochial Church Council (Powers) Measures 1956, that apply. This means the church council in the location, can make, levy and collect a ‘voluntary’ church rate for any purpose connect with the affairs of the Parish on a bi annual or annual basis.
Also, service charges must be made clear upfront along any further works expected at the building you will be moving into. If there are major works upcoming, as your real estate broker, Stonelink International would advise a ‘service charge cap’ be implemented in the agreement, during the period of works or in certain case the full extent of the contract.
4 – Rent Guarantees
It is common practice for businesses to be asked to provide a rent guarantee or a guarantor to stand in as your back up should you default on the rent. While in many cases a bank guarantee, along with financial accounts will be fine, landlords may ask for a cash deposit or even charges on your own personal property, unless a guarantor steps in on your behalf. Your broker should advise you of this in good time, so you can be fully prepared.
5 – Outside factors that affect the overall cost
The cost of commercial property relies on a lot of things; location, condition, size, building, lease restrictions, landlord, neighbours, the state of the market. A top property broker will go over all of this in detail before you get started, but the best property broker, will also outline all outside and additional costs, formulate an action plan, so you can make sure to budget effectively. Make sure you consider aspects that may not seem very big, such as service charges, building insurance and business rates in detail, before you make any decisions.
Looking to sign a new commercial property lease or discuss how to get out of your current one? Get in touch now and speak with the London Broker at Stonelink International direct on + 44 (0) 207 993 4081 or contact us for a fast response.