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What Are My Options to Eliminate My Office Space Rent?

The market has plummeted and now your business is taking a hit. Furthermore, you are not able to go into your office because it is not considered “essential” or out of the risk of your employees’ health and safety.

Every lease is written differently but there could be a few clauses that may be arguable in your favor. We are not attorneys and can’t provide legal counsel, however, we have identified and selected attorneys who are experts in Force Majeure and Impossibility Clause. Below are 3 action steps you can take to minimize any financial overhead you have with your Landlord.

PPP Loan.
The PPP Loan can be used towards office space rent, utilities and interest on a mortgage. If you have not already and missed the first round of funding, take advantage of the second round. You will want to apply directly through your bank. It is recommended you apply through your existing bank.

Make an Appeal to Landlord.
Ask your Landlord if you can forgo rent for the next ninety days. Not all Landlords would be accepting to this but it does not hurt to ask. A way this could be presented is the next ninety days is waved and then owed in addition to your next rent payment. For example, rent for May, June and July could be waved and on August 1st rent May-August will be due. Another scenario, you could tack it on to the end of the lease or spread the rent over the next several months. There are several ways this could be accomplished depending on the Landlord’s appetite and the Tenant’s ability to pay.

Review Your Lease.
As we stated in the beginning, every lease is different. Dig up your lease and you will want to review for two clauses, Force Majeure and Impossibility clause. Both of these clauses could provide means to bring to your Landlord but that would be for a Real Estate Attorney to advise. Force Majeure is defined as “unforeseeable circumstances that prevent someone from fulfilling a contract”. Impossibility is defined as “is an excuse for the nonperformance of duties under a contract, based on a change in circumstances (or the discovery of preexisting circumstances), the nonoccurence of which was an underlying assumption of the contract, that makes performance of the contract literally impossible.”

Additionally, the State of Florida is a very Tenant friendly state in regards to laws between Landlords and Tenants compared to other states. Having a Tenant Representative provides a competitive advantage to understand the pulse of the market and insider only, knowledge. Give our team at Office Space Brokers a call 813-289-3700 or email at cd@officespacebrokers.com to evaluate your company’s office space solution and walk you through this process to minimize your financial risk while you business is at a standstill.

Chelsea Drinkard No Comments

How Could the Corona Virus Change the Future of Office Space?

Short answer, it’s too early to tell the impact the Corona Virus will have on office space market in Tampa Bay. However, there are a couple of factors based on the shift we have seen with the Corona Virus that could impact office layout, cleanliness and the space requirements. Reviewing the top three factors which were impacted from the Corona Virus were air quality, limiting the touching of common surfaces and shared common areas. Below I have addressed the three different areas and how each could be impacted.

Cleanliness and Air Quality.

Good air quality has already been correlated with productive work environments and minimizes the number of sick days. Air quality improves the over all sense of well-being, focus and productivity. Buildings who have high standards for air quality and circulation will be favored over others. If a technology is created to minimize this impact of virus spread, this could also be a consideration when companies are reviewing which office buildings can provide the safest environment.

Landlords could increase cleaning standards by their janitorial companies in common areas such as fitness centers, bathrooms and elevators. The recent addition of Tenant lounges in office buildings with shared kitchens, meeting spaces and activities will have be evaluated with new cleanliness standards or reconfigured. Tenants who hire their own janitorial services, might have to comply per their lease, cleaning standards within their office suites.

Office Layout.

We have seen the trend of more open work environment shift over the years, some with smaller work areas and bringing people closer together. For example, think of two long tables with employees on each side, creating a community work area that several companies have adopted. Work stations moved into shorter “walls” to create a collaborative and open environment.

The immediate use of small and large conference rooms could be avoided. The changes of the 6 feet in between individuals which has been mandated could translate into the layout and space needed to fit the same 20 people may increase thus, requiring more space allotted per person. Individual offices could return as a solution or larger work stations with taller walls and dividers could make an appearance. Click here to read the average work stations and office sizes and what is your company’s ideal size.

Working From Home.

I have heard some say companies transitioning to working from home could reach a point where production is consistent and the habit of working from home has created a new culture which the staff prefers. I do not believe this 100% work transition will occur, it depends on the industry, company and the culture of the company.

I believe the 100% transition to remote work may be less common, a hybrid of minimizing the number of people in the office and frequency may be more common. The opposite could also be true, realizing the need for in person communication and collaboration is required for productivity.

 

Making  the protection of health and safety of employees a top priority, will reduce risk and position companies to be a top employer of choice in a competitive environment. Having a Tenant Representative on your side will provide an advantage only an expert with their ear to the ground on a daily basis can deliver insight and market specialization. Give our team at Office Space Brokers a call 813-289-3700, for a consultation to strategize your company’s office space steps.

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My Office Space Lease Is Coming Up and The Economy Just Plummeted

Is your lease coming up in the next 6-9 months? If so, your decision to renew or relocate will have a few additional factors to consider when making the decision.

It is typical for a lease renewal deadline to be given in writing to a Landlord at least 6 months prior to the lease ending. You might find yourself in this situation, your lease is up in the next 6 months and not sure if you plan on relocating or renewing?

Check your lease for a Renewal Deadline.

We wrote a blog giving you a map, to avoid hidden traps when renewing your office space lease. Use a fine-tooth comb to check when your notice, if you chose to renew your lease, is due to the Landlord. Double check there is no requirement to notify the Landlord you will not be renewing. If you need more time, go ahead and ask the Landlord for an extension on the notice to provide to the Landlord whether you wish to renew. Office Space Brokers clients, we give clients a thirty-six, twenty-four, twelve and six month reminders to assist in this planning process.

Make a Scenario A and Scenario B plan.

Create two scenarios for your office space requirements. Scenario A is best case scenario for your business and Scenario B is worst case on how you foresee your office space needs will be impacted. Office Space Brokers provides a free resource on our website where you can calculate your office space requirements based on your ideal layout. Click here to access the calculator. 

Create Your Budget.

What is your Scenario A and Scenario B office budget? If your budget drastically decreases but the office space size requirements stays the same, considering a different submarket or changing the class of building you lease, can provide the opportunity to meet your budget. When you change from a Class A building to a Class B building that is something that could change the type of lease structure. Click here to read more about the three most common lease structures.

Commercial Real Estate typically responds to market shifts and not necessary and economic leader. As I am writing this article, it is too early to see the lasting impact except for the noticed impact in the small retail and restaurant businesses.

Having a Tenant Representative on your side will give you the pulse of the market and insight only having your ear to the ground on a daily basis can provide. Give our team at Office Space Brokers a call 813-289-3700 or cd@officespacebrokers.com to evaluate your company’s office space solution.

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Fourth Quarter 2019 Office Space Market Indicators and Report

Important Highlights:

o Unemployment rate in Tampa Bay dropped to 2.7%, lower than the US average of 3.9%.

o Tampa Bay’s economy accelerated over the past year, adding over 30,000 jobs for an annual growth rate of over 2.0%.
o Class A rent increased over 6% a Square Foot, pushing the average rent across the Tampa Bay Market over $30.00 Square Foot for the third consecutive quarter in 2019.

 
Let’s Talk Rent Numbers:

Submarket

Overall Average Asking Rent All Classes

Overall Asking Rent Class A

Westshore

$33.85/sq. ft.

$36.87/sq. ft.

Downtown Tampa

$34.62/sq. ft.

$36.39/sq. ft.

Northwest Tampa

$23.96/sq. ft.

$26.40/sq. ft.

South Tampa

$29.60/sq. ft.

N/A

i-75 Corridor

$22.53/sq. ft.

$25.78/sq. ft.

Southwest

$19.75/sq. ft.

$24.00/sq. ft.

Downtown St. Petersburg

$27.91/sq. ft.

$30.18/sq. ft.

Construction Highlights:

Approx. 2 million square feet under construction and increase in speculative construction. Tampa Bay is on tract for it “largest injection of space in over ten years.” Heights Union and SkyCentreOne are both projects underway in Downtown Tampa. Heights Union recently landed co-working giant, WeWork, as a 50,000 SF lease.  Sparkmarn Wharf is renovating the office portion creating 200,000 SF of office space. Highwoods plans to renovate the 100,000 SF in Westshore formerly leased by Laser Spine Institute.

2019 4th Quarter Forecast:

Companies outside of Tampa Bay and around Florida and the country will continue to target Tampa Bay as they identify cities to expand due to Tampa Bay’s opportunity for small to large growing companies. Tenants may continue to leave Class A+ buildings or maximize existing office space for efficiently, as they experience sticker shock and move into B buildings and other Sub-urban markets.

What does this mean for Tenants?

o Flexible office space solutions have increases with We-Work location in Downtown Tampa and Pipeline for Tenants who prefer short term and flexible options.
o Parking in downtown Tampa still remains an issue with limited spots and cost is high.
o Construction costs remain high and Tenants may have to sign a 7-year term to cover requested Tenant Improvements.
o The end of 2020 should provide a wide variety of office space options with approx. 1,000,000 Square Feet in the pipeline for new construction.
o Now is the time to have a Tenant Representative Broker advocating on your behalf. The market is dynamic, availability is quickly shifting and having a Broker who has their finger on the market pulse and long-standing relationships with Brokers will get you the best terms possible.

 What does this mean for Landlords?

o Landlords are moving forward with new Class A construction to meet the forecasted transition into smaller, sub-markets i.e. Water Street and the Heights Union with upcoming residential construction, creating a dense, live work and play environment

o Class A rent is in the $30-$45 Square Feet Full Service depending on location and new construction
o Westshore, Downtown Tampa and Downtown St. Petersburg are still highly desired areas for Tenants especially with generational shift of decision making
o Landlords of Class B and C buildings continue updates to remain competitive with new office buildings breaking ground
Chelsea Drinkard No Comments

Women’s History Month Client Spotlight Part Two

“In honor of Women’s History Month, I asked six clients who are women owned businesses to answer two questions about their success in business and one piece of advice and encouragement they would offer to other professional women. Each of these six women come from different industries and in most cases are trailblazers and trendsetters. Here are three of the women I highlighted. I highly recommend you read the advice and encouragement of the other three women too by clicking here.

I am so thankful for the opportunity to have worked with each of these women in identifying the right commercial real estate solution in Tampa Bay. I believe business is more than a transaction and I love working with companies who have an aligned mission. I can confidently say each of these women practice what they are sharing. Check out their website to learn more about their companies. If you have the opportunity to work with any of these women below, you could not be in better hands. Here’s to Tampa Bay, our business women leading the charge, shattering glass ceiling, making room at the table, spear heading initiatives and driving the heartbeat of our economy!” – Chelsea Drinkard.

Carrie Charles

BROADSTAFF

About Carrie:

Carrie Charles is the CEO of BROADSTAFF, a Technology Staffing Firm, named a 2019 Tampa Bay Fast 50 company. Carrie is the host of 5G Talent Talk Podcast and has been a featured expert on NBC, HSN and Clear Channel networks. Carrie is a thought leader on workforce development, diversity and is a keynote speaker at national conferences. She is a 2019 Businesswoman of the Year Honoree in Tampa Bay.

Carrie is a member of the Board of Advisors of Cable Runner,  a member of the Board of Advisors of NEDAS Technology Association, the Executive Director of Industry Relations for the Women’s Wireless Leadership Forum and is a sits on the Board of Directors of the National Pediatric Cancer Foundation.Carrie has a diverse background as a lifelong entrepreneur,

Certified Financial Planner, Master Certified Executive/Business Coach and the United States Marine Corps.

Best piece of advice for women in business:

“Build a personal brand and a strong network.  Leverage your network to build your business.  Be persistent in sales, sometimes it takes months or years to close big accounts. Do not take no for an answer EVER. Find another way.”

Key ingredient to your company’s growth:

“Hire the best people, even if they are more expensive. Nurture your business relationships by giving first, always give before you ask. Outwork everyone, including your team.  Have mentors and ask for advice from those who have succeeded in your field.”

 

Casey Corwin

Corwin Design and Graphics

 About Casey:

Casey has led an impressive career as a business owner and hands-on graphic designer in her thirty-five years working in the print marketing industry. In 2012, Corwin was named Business of the Year by the City of Tampa. Corwin has also been featured in several well-known industry publications and associations, including the Tampa Bay Business Journal, LinkedIn, the Florida Health Care Association and the National Association of Activity Professionals.

Serving as the CEO at Corwin Design & Graphics Corporation, Casey plays a major role in the day to day operations and mentoring her staff. Through her commitment to this role, she has helped Corwin retain valuable team members who have been with the company for over twenty years.

Before starting the Corwin team, she was the “hands on” Business Partner at The Sharper Edge from 1989-1993 where she was a printing press operator and graphic designer.

Best piece of advice for women in business:

“My biggest advice is to follow your passion and stay on track with your goals – they don’t have to line up perfectly, they just have to be followed. When the going gets tough, that’s when you’re in your jam; keep going.”

Key ingredient to your company’s growth:

“Honesty and respect to my team and our clients. Laughter and great music (it’s my day too so we all enjoy it).”

 

Angie Speller

CEO and Lead Clinician at Enso Behavioral Healthcare

About Angie:

Angie is a Licensed Mental Health Counselor and Board-Certified Counselor. She received her Master of Arts from the prestigious Rollins College. Aside from her training in Mental Health Counseling, Angie received specialized training in Dream Interpretation, Mindfulness Meditation, and Hypnosis. Her experience in the substance abuse treatment field as a clinical director for over five years, and eleven years additional experience in the field, indicates her dedication to the recovery population and community.

To say that Enso Behavioral Healthcare provides professional, ethical, and effective mental health services is true. That’s the essence of what we do but hardly tells the whole story. Our practice aspires to be a luxury beacon of holistic services, treating the mind, body, and spirit. We believe that we will be successful if our clients are successful.

Best piece of advice for women in business:

“One piece of advice that I would say to women in business is ‘don’t ever forget who you are’. It’s so important that you are represented in everything that you do. Your passion, your voice, and your vision are reflected in your work. No one, absolutely no one, is you and your business needs you.”

Key ingredient to your company’s growth:

“The key ingredient to my company’s growth is God and integrity. If I don’t enlist the support of powers greater than myself to come to my aid then I am lost. I believe there is value in investing in marketing, networking, or web designs but nothing can out measure God and asking for what I want. If I don’t ask God, the universe, or others for what I need and what my dreams consist of then I will never attract it to me. Keeping that a secret will not surprise others into viewing my success it will isolate me and keep me stuck doing it all myself. However, if I enlist the power of others support and help then they will look forward to my success and encourage my growth. Lastly integrity is paramount. I have to do what is right for people and not just myself. Selfishness and ego have never encouraged anyone to support someone. You don’t think about that selfish person and say, ‘I really want to help them succeed and do well in life’. We think this for the people who are genuine and kind and full of integrity. We want them to win at life. I want you to win at life. Be a person worth cheering on.”