Basics of Property Management: Screening Potential Tenants

3 Ways To Ensure An Office Building Is Within Your Budget

2 February 2022

Jesse Obrien

The office building you choose to house your business operation makes all the difference in its overall success. Therefore, when you have to find the right location, you have a lot of factors to consider. One of the biggest factors to consider is price. The building necessary for your business to operate can be one of your bigger expenses, and you definitely need a place that falls within your budget without generating cash flow issues. Here is a look at a few ways to ensure an office building is within your budget. 

Compare business revenue to monthly rental costs 

When it comes to how much a business pays for rent, there are general guidelines that most business owners follow regarding revenue-to-rental costs. The general range for the percentage of revenue allocated to rent tends to be between 1 and 13 percent, but most businesses pay less than 10 percent for their office building. Naturally, some industries will have more location-based needs. Therefore, they may need to pay more of their revenue for an office building than others. Work with your accountant and outlying consultants to pin down a revenue percentage that is logical for your business specifically. 

Reach out to local utility companies regarding prior bills 

In a lot of locations, you can get an idea of how much utility bills generally cost at a certain vacant address by requesting the information from the servicing utility company. For example, if you are curious about how much your electricity bills could be, you can call the electric company and request an average bill amount for the past year. While there can be variances in bills with your business operation, this is a good way to guestimate utility costs at the location. Therefore, you can ensure the utility costs will be within your business budget. 

Consider the costs of office building maintenance 

All office buildings have their own quirks and considerations when it comes to maintenance. For example, buildings with a lot of windows may require more time and attention to keep those windows clean. Before settling on any specific office building for rent, make sure to consider the maintenance that will have to be covered by funds from your business budget. Some places may be a better fit if maintenance will be less costly. Keep in mind, some places for rent may also offer special perks like included exterior building maintenance or landscaping.

If you are interested in learning more about office building space, contact a business center like 65 Challenger which can provide available space. 

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