Relocate Your Office

Do you really need to move your office?

  • Can you stay where you are for the next five years?
  • What are costs to stay?
  • Do you have flexibility in the same location?
  • What is the attitude of the current landlord
  • Is the current facility a good location?
  • Is the current building adequate and cost effective?
  • What are the costs of relocation and down time to the business vs. staying?
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If a move is necessary, then:

Give yourself time; this process can be more time consuming than it has been in the past.

Companies must to keep functioning as the research, negotiating, construction and relocation take place. It is not uncommon to have the entire process take up to two years.  

Once you know whether or not staying in your current office is an option – then the following steps will provide market data to negotiate a relocation or a renewal as well as leverage on existing landlord.

Ten Steps To Relocate Your Office

  • Commercial agent with BOTH leasing and occupant type sales experience.
  • Define goals to accomplish
  • Do a Space Program
  • Define Locations
  • Define Initial Square Feet Needed and Growth
  • Make basic location and size decisions
  • Purchase or Lease
  • Set decision timeline prior to the end of your current lease relationship
  • Be aware of the holdover provisions and their costs in current lease
  • Determine the cash out of pocket budget
  • Estimate cost trends and Operating Expenses for the marketplace
  • Together with your agent review product options in market
  • Stay
  • Move & Lease
  • Move & Purchase.
  • Attorney
  • TI Contractor, if needed
  • (If a purchase) banker, CDC representative, appraiser
  • (With contingencies, if required)
  • Clear contingencies and final
  • Sign with all attachments included

If you want to lease

IF LEASE:

  1. Pick the Top Two Lease Options (and a backup)
  2. Never fall in love with a building early. (It could hurt you in negotiations when the final terms and conditions of the LOI or the lease are being negotiated.)
  3. Prepare a Letter of Intent (outline business points and timing. Include as much detail as possible as it may be the basis of a final contract later.)
  4. Prepare Company Financial Information to be delivered to Landlord later.
  5. Hire your own space planner. RECOMMENDED

(If the landlord is providing space planning, that space planner usually will be paid by Landlord as a part of the Tenant Improvement allowance of the deal. However that space planner will be given directions from Landlord and sometimes the Tenant’s best interest is not their first concern.)

  1. Hire a good leasing attorney. (A good attorney’s costs are worth the money and will save time when you get into the legal issues in a lease contract.)
  2. Immediately send a copy of the Insurance pages of the lease to your insurance agent to review for coverage and costs. In most cases this will only take a few minutes and also let’s you know early in the negotiations if changes in coverage need to be negotiated.
  3. Make sure the IT service you require is available. (Most buildings today have the capabilities, but send the address’ being considered and double check with your service provider.
  4. Review and Final the Lease agreement (Final Floor plan needs to be attached as an Exhibit and it must contain all required specifications on first LOI Draft).
    1. Make sure all TI work is detailed as a part of the lease without any open end TI Costs that can be charged back to you later after you have signed the lease. TI costs and specifications need to approved by both sides in the lease. All TI costs must be a contingency to the transaction that allows you to get out if the costs are too high.
  5. Include a paragraph that specifically allows cancellation of the lease if costs are unacceptable to the Tenant.
If you want to lease

If you want to purchase

IF PURCHASE:

  1. Pick the Top Two Options (and a backup)
  2. Never fall in love with a building. (It could hurt you in negotiations when the final terms and conditions of the LOI or the lease are being negotiated.)
  3. Prepare a Letter of Intent (outline business points and timing. Include as much detail as possible as it may be the basis of a final Purchase and Sale Agreement later and will help flush out deal breaker points before extensive costs are incurred.)
  4. Meet with a qualified small business banker that specializes in this kind of transaction and a local representative of a CDC (SBA lender) These two specialists can assist in evaluating the purchase and ultimately putting a financial package together. This will depend on whether you are proceeding with a conventional or a SBA Loan.
  5. Prior to preparing an LOI and staring building survey, know your capabilities as a SBA Borrower.
  6. Interview and Hire a space planner. (It is important to get professional help making sure the correct needs are being met with any purchase (i.e. Is the building the correct size for the business’ needs.) Also space plans and detailed specifications will be needed by a contractor to provide construction costs that are going to be required by any lender to obtain a written commitment from the bank. You will absolutely need the bank’s final commitment before you waive any contingencies in your purchase and sale agreement putting your deposits at risk.) May be a good idea to field measure a finalist building for accuracy with the space planner and Real estate Broker.
  7. Interview and hire a good attorney. (A good attorney’s costs are worth the money and will save time when you get into the legal issues in a Purchase and Sale Agreement.)
  8. Interview and choose a General Contractor (You will need to give the Bank full TI Construction costs to obtain a financing commitment. You cannot waive final conditions in the PSA Agreement without a written firm bank commitment.
    1. Make sure you watch what contractor costs are being incurred during this period in the event you cannot get financing or want to abort the purchase.)
  9. Discuss the Purchase with your Insurance agent.
  10. Make sure the IT service you require is available. (Most buildings today have the capabilities, but send the address’ being considered and double check with you service provider.)
  11. Review and Final the Purchase and Sale Agreement (There needs to be a Contingency Period that the Buyer can cancel for any reason up to a set date or occurance and get all the deposits back.) Make sure you know the process to stop or continue the sale as it is stated in the contract.
  12. Open escrow at a Title Company and obtain a Preliminary Title Report. (This will have all the information needed to evaluate the property from a title perspective, CC&Rs etc.)
    1. Have the Agent and the Title Company develop a timeline with milestones that need to be accomplished.
    2. Complete evaluation of the property, the loan package and the required construction work.
    3. Obtain written bank commitment.
    4. Move forward or Stop the process in writing to all parties.

    If Stopping

    1. Cancel Escrow in writing and get deposit back.

    If moving forward

    1. Notify the bank and Seller in writing and the Title Company
    2. Increase deposit as per the P&S Agreement as required
    3. Authorize the space planner to commence final Construction Drawings and ultimately the application to the Planning Dept for the necessary permits.
    4. Hire your Contractor and get a contract for the needed work. (There are lead times for some of the items that need to be considered, you will be closing escrow likely on a shell and need to have your “ducks in a row” to build out the TI work quickly. It is expensive to go slow.)
    5. Make sure the appraisal is ordered and underway from your lender and the Bank knows your COE date.
If you want to purchase