Office Relocation: Ten things you need to consider

Richard Lace | 17 March 2014


For most occupiers, the prospect of relocating offices creates an unwanted distraction to their focus of running a business. Searching for suitable properties, coordinating viewings and negotiating heads of terms can be stressful and time consuming and that’s all required before the physical job of moving has even begun.

In this article, we’ll lead you through the main points to consider when embarking on an office relocation and offer tips and advice on avoiding the pitfalls many occupiers get caught out by.

1)    The exit strategy

It’s imperative to clearly understand the terms of your existing lease and to be aware of any lease events, whether a break option or a lease expiry, well in advance.

If you want to move out of your premises and miss your option to break you could be left “on the hook” for a further 3 to 5 years.

Your lease will set out the mechanism for serving the notice to break or terminate the agreement on your current premises, the timescales within which your notice must be served and any other conditions you must comply with.

In an ideal world, you want to be thinking about your potential relocation at least 12 months in advance of needing to vacate your premises always be prepared.

2)    Dilapidations

When relocating offices there is every chance that you will have a yielding up provision in your current lease. In basic terms, this sets out the condition in which you must hand back your suite when vacating. Unless expressly stated in the lease, you can assume that this will be in a similar condition that you took it in.

These works required, referred to as dilapidations, can be carried out prior to vacating the premises or a financial settlement can be agreed. Usually the more cost effective option is to carry out these works yourself prior to vacating the suite.

In order to fully understand your dilapidations liability, it is always advisable to have an assessment undertaken by a qualified building surveyor. Opportunities will present themselves to save considerably on any dilapidations claims made by a landlord – the amount demanded will be subject to negotiation.

3)    How much space do you need?

Understanding your spatial requirements is of paramount importance when looking to relocate. Changes in working practices, new technology, furniture and the layout of the working environment can all impact of the amount of space required. You may also want to build in some expansion space if you are committing to a lease of 3 to 5 years or longer.

There are many ways to increase the efficiency of the working environment you occupy. Amongst other things, spend time looking at the amount of time people spend at their desk, what level of usage there is of the meeting room facilities and how storage space is utilised.

All these things and others can result in substantial waste and over spend on your occupational costs.

4)    Location, location, location? –

  • Whether it be a city centre or out-of-town location, some important things to consider are:
  • Access to skilled labour
  • Public transport infrastructure
  • Broadband connectivity and speed
  • Future development
  • Nearby amenities – retail, hospitality and leisure.
  • Motorway connectivity

 By co-ordinating a search through a retained advisor, you can ensure you are focusing your efforts on the most suitable areas for your business. Retained agents are also able to provide a knowledge of potential “off-market” opportunities that you may not otherwise be made aware of.

5)    Budget

Any business looking to move needs to understand their occupational budget. Whilst the office market has gone through a pretty rocky period of late, the recovery is well underway and whilst it’s still possible to find very competitive terms, a clear understanding of the market is key to exploiting these.

The cost of any move must factor in the dilapidations liability payable at your existing premises, the cost of fitting out the new premises and professional fees.

The good news is, ingoing incentives (usually a period of paying zero rent) can be structured to offset all or a large part of these costs.

6)    Workplace Consultancy and space planning/interior design

A huge opportunity presents itself when relocating offices to look at the way your business operates.

Examining how different teams collaborate and interact with one another and ensuring these teams are situated in a layout that maximises their productivity is vital.

By creating an inspiring workplace that people want to work in, you can help attract and retain the best talent and enable your business to really thrive.

7)    Fitting out and project management

Moving offices will be a new chapter in your company’s history, but this transition can be disruptive and costly to a business without efficient and considered project management.

There are a number of different routes to fitting out an office and by competitively tendering the work, it is possible to make some significant cost savings. Once a contractor has been chosen, management of the works and quality assurance checks should be undertaken by a professional building surveyor.

8)    Move management

Often carried out by the awarded contractor, move management is the co-ordinated relocation of existing fixtures and fittings that will be retained in the relocation. This will generally involve a strategy and relocation plan which will be combined into the main project programme of key milestones.

Efficient move management will provide you with a comprehensive catalogued schedule of items to be moved and secure execution of the relocation plan. This enables you and your employees to focus on your day jobs throughout the move, which can usually be carried out during a weekend to minimise disruption to a business.

9)    Remember your saff

It is imperative to engage with your employees so that they “buy in” to any move at an early stage. The balance between your team viewing a move as a positive or something that is going to impact negatively on their day-to-day work is a difficult one to achieve.

When we undertake a relocation on behalf of a business we aim to work closely with Heads of Departments, HR directors and team leaders to ensure that those involved get fully behind the project from the outset.

10) Timescales

One of the pivotal tasks when setting out on an office relocation is agreeing key dates, tasks and deadlines. This may surround the serving of notices, agreeing terms, completing the legal negotiations on time and finally making sure the new office is ready to occupy when the moving day finally arrives.

There are many aspects of a move where you will be relying on a third party to make things happen (e.g. the installation of new phone lines). These activities can involve potentially long lead in times and it’s vitally important to identify these at the earliest possible stage in the critical path.

Be sure to avoid delays and complete any of your designated tasks in good time. This will ensure you cause the minimum disruption to business and achieve a stress free move.

And, you?

Have you recently undertaken an office relocation? And if so, have you adopted new ways of working? We’d love to hear about your experiences so give us a shout on Twitter or Google Plus.

If you’re thinking about relocating your business, or want advice on any of the issues we’ve discussed in this article, be sure to get in touch today.

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