Commercial office space leases are unique in many ways. One way relates to the length of the lease term for the commercial office space. As opposed to residential leases which are usually on an annual basis, commercial leases are a bit longer. You can choose a 3 or 5 year lease in some cases while other landlords require a 7 or 10 year lease when they want the tenant to stay in the leasehold for a bit longer. This will vary by location and landlord preference as well.
When trying to decide which type of lease term is right for you and when you want to choose an office space to lease which offers you the desired lease term, the following considerations will help:
Desire to Permanently Lay Down Roots in the Area
For business owners who know that this town or business center is where they would like to stay permanently, it makes sense to lease the office space for as long as possible. Unless you are interested in buying an office space within a few years, you want to reserve your current location as long as possible, especially if you want to stay in the area for the long term.
How the Location Suits Your Business
If you look at a lease option in a particular area and know that this will be a lucrative locale for your business, you can lease for a longer period of time. For those business owners who want to lease an office space in a current location but may not be sure how they will do overall in that specific area, a shorter lease term is advisable.
It is good to know that the longer the lease term, the less expensive the lease may be. If you are leasing with monetary considerations in mind, which most business office tenants are, then getting a longer lease, if possible, will yield better financial results for you. Be sure to inquire with your landlord as to the cost for shorter and longer lease terms. Some landlords will offer the lease for the same amount, no matter how long the lease term may be, while others are amenable to lowering the price for a longer lease term.
Plans To Expand Employee Base
Another factor which will help you to decide how long of a lease term to enter into involves your current and future employee base. If you are going to stick with the general number of employees in the future and do not foresee plans to increase your employee base, then you may want to sign for a longer lease term as you won’t have to be concerned with the amount of office space in the future since your employee number will remain similar to the employee number you currently have.
Deciding on the length of the lease is an important consideration. You want to try to think ahead and determine approximately how long you will want to stay in that same location. Even though this may be a difficult decision to make so early on, it is something which must be considered prior to signing your new office space lease.