As a professional commercial real estate broker, I have come to the heartbreaking realization that my clients just don’t think about their real estate every day; indeed, they think about it only when they absolutely have to. The problem is that real estate decisions sneak up on you and then you find yourself with limited time to make them, and limited choices.
Planning for your businesses facility needs should start two years before your lease expires. Indeed, it is before you feel the pressure to make a decision that you have the luxury of looking at other submarkets around you and ponder the implications for your business.
The business landscape changes continuously. The view when your lease expiration pops up over the horizon may be quite different than what it was when you first signed your lease. Can you still afford to be in your current neighborhood? Certain submarkets like Santa Monica and El Segundo have seen dramatic rent increases over the past five years. Is there an emerging market that your industry is flocking to?
Sure, you can get the feel for an unfamiliar submarket pretty quickly but think of the many and serious ramifications of moving your business: Will the commute be too much for some of your key employees and if so, what mass transit alternatives are available? What are the demographics of the workforce there and does it possess the talent your business will need to attract to continue to prosper in the future? Are you anticipating changes in your own business that suggest where you need to be and who you need to be neighbors with?
Take the time to explore, to drive with your broker, check out the nearby amenities and watch the people on the street. When the time comes to really deal with your next lease term, you will have a much better idea where you are likely to find the perfect space.
Give yourself a chance to gaze into your crystal ball – what you see might surprise you!