The beauty of renting office space lies in the freedom it affords your business and the confidence you can find in knowing that you haven’t been saddled with a commitment you don’t want. However neither buying nor renting is suited to every business and as such there are some pros and cons to each.
As small businesses grow in stages it is important to work out what kind of ownership you want over your office space in each stage. If this is your first stage it is likely you will want to lease, usually due to a lack of money to invest in such a large commitment as buying your office space. As you grow, however, it can be that once you have reached your final capacity employee wise and know fully what your space requirements are you are better placed to make the decision to buy.
Here are some easy questions that can help you decide whether you should lease or buy your office spaces:
Is your current lease full service?
Sometimes when buying space businesses take the maintenance and services they have enjoyed with their lease for granted. For example here at Adelphi Mill we offer many fantastic on site services such as 24hr security and CCTV and refuse collection, a gym and onsite café. When buying office spaces you are often left on your own and there are common extra costs in hiring contractors for the necessary services. Similarly at Adelphi Mill we do not charge for parking, unlike some office space providers that change upwards of £30.
If you’re a start-up or small business it is probably more in your interest to lease, particularly where the lease is full service, as this can help you manage your costs and establish yourself before thinking of making the big commitment of buying.
How often are you moving?
If your business is suffering from increases in rental and maintenance costs, and subsequently you find that you have to move around a lot for the best deals this can be a reason to buy. However, buying is still a massive commitment and you may still have to contract out for services that are included in some rental prices. Here at Adelphi Mill our price is from as little as £23 per week.
It is also important to search around to see if there are fixed rate rents available near you before you decide to buy.
On the other hand if you move a lot due to positive reasons, or can foresee a big expansion, relocation, or even a reduction in size in your future it is probably not a great idea to commit and buy your office space. Unless you are buying just as an investment, your expectations for the near future of your business will weigh on your decision to lease or buy. You ought to have a clear view of the size requirements you have, not just for the now but what they may be in the future as remember buying is a commitment.
On the one hand if companies buy their office space every payment they make with regards to maintenance is and investments in an asset, as opposed to paying someone else your hard earned money. If you can afford to buy out a building there is also the possibility of leasing your own space and making some money there. But, on the other hand, if you are a small business with only enough capital for one investment it is likely better that you invest in your business rather than buying a building. Also time can then be better spent on your company over maintaining a building yourself.
Landlord or Tenant?
Whilst it is true that when you are your own landlord you no longer have to worry about the management of your office space becoming a profit maker for your landlord, it is also true that being a landlord is not easy. You should think long and hard as to whether you want the stress of managing your own building, worrying about being committed to a location should some issue arise, such as a competitor setting up shop nearby.
If you feel that you are better suited to paying a monthly fee and thus not having to worry about anything other than your business renting your office space is definitely for you. But if you think that you have enough capital to invest in a building as well as your business it may be a possibility to buy.
With office spaces for £23 per week and fantastic on-site services such as CCTV, refuse collection, and free parking, Adelphi Mill can offer your business a fantastic opportunity to rent in a brilliant area just outside Manchester. We have a fantastic retention rate and our tenants recommend us to those looking to rent office space in the UK.