Office space provides a home base for your employees and day-to-day operations. Typically, organizations that seek new office space in Arizona have recently experienced considerable growth and need to find a place that can accommodate their changing needs. In many cases, companies in search of office space have simply outgrown their present location. Alternatively, the business may have added a new division or department with additional employees and needs a new office to make room for the expansion. Finally, a business may need office space because they are relocating within their home city or to a new city. Regardless of why your business needs new office space, the process of finding a new office is fairly standard. Though the process is not excessively complex, most businesses find the purchase of new office space to be stressful and confusing. In this post, we’ve broken down the purchase of office space into simple, manageable tasks to help you find the ideal office for your unique needs.
Locating Office Space
When it comes to locating office space in Phoenix or other Arizona cities, businesses have two options. First, they can recruit the assistance of an Arizona real estate broker or agent. Alternatively, the company can decide to attempt the process on its own. Usually, hiring an agent or broker is well-worth the extra money. Your agent can help you realistically estimate your needs and your price range, and you are more likely to find office space quickly when you use a broker. When selecting your real estate agent or broker, make sure you choose a firm that specializes or has a wealth of experience in commercial real estate transactions. The needs of commercial real estate buyers are much different from those of residential buyers. Also look for agents and brokers who regularly sell properties in the city in which you are looking for an office. For instance, if you want an office in Tucson, search for brokers based in that region.
Evaluating Your Needs
Before you begin searching for your new Arizona office, you will have to identify your organization’s needs. First, you should identify your base need, or the reason why your business is moving. For example, are you relocating your company? Does your company need more space to accommodate growth? Secondly, you should identify your financial needs. Look at your company’s budget to determine how much you can afford to pay each month for your new space. When evaluating costs, don’t forget to consider opportunity cost. In other words, make sure the return on the investment in new office space is equivalent to or more than the return you would receive by investing the funds directly in your business.
Buy or Lease?
Generally, companies that wish to lease office space will have more options than those that wish to buy. The market usually offers more office space for rental than it does for sale. If your business is new and not well-established, leasing office space is probably a better option. On the other hand, buying office space can offer a number of benefits as well. Businesses with good credit should have no trouble finding commercial mortgages in Phoenix, Tucson, Scottsdale, Flagstaff, and other major areas of Arizona. The benefits of buying and leasing are outlined below.
- Interest on your property’s mortgage is tax deductible
- You can build equity in your office space
- If the property depreciates, you can deduct the expense on your taxes
- You will avoid rent increases
- You have the freedom to make changes to the space to accommodate your changing needs
- Your business’ credit rating will not matter as much when renting office space
- You don’t have to deal with the hassle of selling the property when you want to relocate
- You probably will not have to worry about building maintenance expenses
- Your monthly rent is a business expenses and is thus tax deductible
- You have the ability to sublet the space and relocate if the need arises