Small business owners make many considerations selecting office space and signing a lease. Mark E. Robinson, corporate managing director of Studley, a national commercial real estate firm specializing in tenant representation and advisory services, discusses the key phases of the process.

“Phase one is to work with a broker and an architect, turn the idea into a real estate/facility plan and identify what the optimum space will be for an office. This way the business owner has a blueprint of the type of space that will work for the company. Most small companies don’t plan on staying small forever, so they have to identify their growth plan too.

“Factors like the number of people working for the company, the types of functions they perform and the type of space they need to perform those functions efficiently are to be considered. Other ancillary needs like mailrooms and conference rooms should be identified upfront.

“Phase two is to survey the market. Any small business should have an architect to evaluate every space they look at, to understand cost incurred and if modifications fit into the budget. The business owner should understand that the total cost of occupancy will also include cost of parking, operating charges, after-hour air conditioning charges and visitor parking validation, over and above the lease amount.

“Phase three is to submit proposals to all buildings and create a horse race among the landlords of the two or three identified spaces so the business owner can negotiate simultaneously. Once a counter proposal is received from the landlords, a financial analysis should be done. Also, if you have an office space with furniture and telephone lines, it will work better and be cheaper than a space with just walls.

“Once a space is picked, the landlord has to be asked to prepare a lease document. Basic details like the rent amount, square footage and duration are easy to verify, but the business owner should generally hire a real estate attorney to look at the fine details in a lease.

“Most importantly, any business should have an exit strategy. If they are not doing well then the lease should offer maximum flexibility to the tenant to sublease the space. Again, if the company’s growth is beyond their expectations and they need to move to a bigger space, then the lease should facilitate that.”

*Case Study is a feature in which experts offer advice on the various challenges that small-business owners often encounter. If you face an issue or challenge you think applies to others as well, please contact the Business Journal at

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