Welcome back to Part 4 of our “Lease Space Like an Expert” series. We’re here to take a look at some of the common mistakes people can make when renting a space, and to say that it doesn’t have to be that way. In this series, we take complicated terms and make them relatable to the everyday leaser. Most mistakes come from miscommunications and avoiding the fine print. We’re coming in to save you from that confusion, and to make YOU look like the expert.
This month’s topic: Square Footage (Oh no, here comes the math!)
Do you know how your landlord comes up with the cost of a space? Don’t worry. We’re about to tell you. It’s set at a certain amount per square foot of the leased space and can be worked out through a simple equation.
$xx.xx x sq.ft = annual rent amount.
Looks like algebra has its place in the world after all. Now let’s plug you in to see how you fit into the equation.
You walk into your dream office space. This is it: you can picture your team sitting around you, brainstorming and firing away at those tasks. This perfect office space is 2200 square feet. You’d like your employees to have enough space, so you estimate about 50-100 sq.ft per person (about the size of a small study room.) Your 15-person team will fit splendidly.
For example, a 2200 Square Foot office space is quoted at $11.50* per square foot. Time for that equation to rear its useful head again. If $xx.xx x sq.ft = Rent, and we plug the numbers in correctly, $11.50 x 2200 = $25,300 annually. If you’d like to budget monthly, just divide the yearly number by 12 months to reach our monthly rental amount of $2108.33.
Simple, right? See, math isn’t so scary.
Now you know how your landlord gets this magic number, and how you can make the most of the space you’re leasing.
We hope we could drop some lease knowledge for you this month. Never forget to read the fine print because GREY AREAS EXIST and each commercial landlord operates differently. Ask your landlord to walk you through the equation if you still don’t understand. Ask for the annual and monthly amounts, and make sure you know where your money is going so that you don’t end up in a financial pickle – they can be pretty sour.
Understand what you sign. Lease smart. Lease safely.
*Lease rates subject to vary based on tenant and property specifications.