How Much Does It Cost to Rent Office Space For My Business?

How Much Does It Cost to Rent Office Space For My Business?

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How Much Should Office Space Cost For A Business?

Average office space ranges from a minimum of $2 per square foot [1] to a maximum of $23 per square foot. [2]

In other words, for a 250 sq foot office space:

  • You'd pay as little as $500/month.
  • You'd pay an average of $2,500/month.
  • The maximum you'd pay is $5,750/month, or more (as you go higher-end or luxury).

How Much Should I Spend On Office Space?

It depends on what you're looking for, as the cost of rent can vary with different factors.

The 3 main factors are:

  1. Location: Location is the main influential factor of office rent cost. It also determines the cost of commuting from your residency to the office.
  2. Grade Of Building: Buildings such as a Grade A or B [3] would affect your rent cost. If you want a higher-class building, you're going to have to pay more.
  3. Size: The size of a building mainly depends on your needs. If you have several employees for your office you need more size, and definitely more rent cost.

Examples Of Office Rent Costs For Different Cities.

Here are few examples of office rent costs for different cities.

Cities Av Office Rent Cost (per sq foot)
Houston $31.00 per square foot
New York $54.6 per square foot
Los Angeles $3.61 per square foot
Boston $19.00 - $83.00 per square foot
Philadelphia $26.00 - $40.00 per square foot

How Much Square Footage Do I Need For My Company?

The square footage that you need mainly depends on the number of employees you have. A common calculation used is to multiply the number of employees by 75 sq ft, i.e., 75 sq ft per employee:

Square footage = Num employees x 75 sq ft

So, if you have 10 employees, you're probably going to need a ~750 square foot office.

However, it depends on the type of company, and other estimates also include 100 sq ft per employee. But remember, amenities and other extra services can still impact your rent cost.

Should I Sign A Monthly Or Yearly Lease For Office Space?

It mainly depends on the landlord or hiring party, what they are offering you. Some landlords are certain with yearly leases, while some can be flexible.

Either way, you have to decide which is the best for you. If you aren't going to use office space for a year, then it is best to go with a monthly lease, but if you are, then the yearly lease is a far better option because you can cut some extra costs with a one-time payment.

Other than that, you are not bound to pay per month, which can increase your monthly profit.

Should I Use A Coworking Space Or Rent My Own Office Space?

Coworking spaces have been in the eyes of many micro-business owners for a while now because of their low prices.

However, when you share a working space with others, there are some drawbacks.

  • You need the conference room for your meeting, but it is either busy or pre-booked. It can significantly affect your business.

  • As it would be a shared space, there would be several other people working as well, which makes your space noisy as well.

Dedicated office space can be a better option for small to medium-sized business owners because you can be the boss of your space and expand the way you want.

What Amenities Are The Most Essential In My Office Space?

There are several amenities landlords offer their tenants. But, some come with a hefty price. Here are some of the main ones that you must-have for your office.

Must have amenities:

  • Wifi access in every room - Wifi is one of the basic needs nowadays, and all companies must have an internet presence. So, it is nice to perform actions from every room.
  • Well-equipped meeting spaces - While in a meeting room, there is always a need to show your idea apart from words, in which whiteboards and projectors can come quite handy.
  • Easy access for employees - The more easily employees can fee around your workspace, the more productive and better results you can get from them. So, small accessibility features that can make them comfortable are essential.

Optional amenities:

  • Cafeteria - Your employees not only work in the office, but they also live in that particular space, and no one can do a good job with an empty stomach. Hence, adding a small addition of cafeteria can take your office to the next level.
  • Fast Elevators - Although taking stairs instead of an elevator is much encouraged for health concerns, but fast elevators are way time-saving, especially if you have a multiple floor building.
  • Outdoor Facilities - Not everyone is a big fan of indoors. Even if it's a rooftop, patio, or some built-out lounge, your employees would admire heading out for a brief and enjoy working in the sunshine.
  • Window View - Glass windows can be the most underrated facility on your list. Still, they can significantly improve the productivity of your employees. Also, employees are less likely to fall asleep within the daylight.

Where Can I Find Office Space For Rent?

There are plenty of options that you can use for renting office space. Here are few best ones that you can go for.

  1. Regus: They have a broad number of offices that anyone can rent depending on their needs. Whether you need one for few hours to few years, they have got you covered.

  2. Instant Offices: Instant Offices have a strong network of office space throughout all the major cities in the US. You can definitely get your dream office from the available options.

  3. Spaces: Spaces is one of the most liked platforms. Whether you need a single desk or full buildings, they have fabulous plans for your needs.

How To Lower My Rent Costs?

  1. Select a closer location - Choosing a closer location to your residency can significantly reduce your expense. Also, get an office close to the market so you can get anything you want with ease.
  2. Negotiate on rent - Mostly, landlords ask for more than the market price. Negotiating with them can save you a good amount throughout your lease.
  3. Renew for a long term - Rent is not the only expense you have to bear with a new office location. You have to shift from one place to another that might cost you a fortune. Hence, renewing your lease can be a better option.
  4. Look for incentives - There are some little incentives with several options. Although they might not feel as intriguing, they can save you a good amount in the long run.
  5. Search properly - Have plenty of time to search through the options. You should start the leasing process at least 6-12 months before and check out all the options that fit your budget.

References

Contributors

Contributors to this article:

Pat Walls,  Founder of Starter Story

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