A survey taken among members of the International Tenant Representative Alliance (ITRA Global) yielded surprising results: the number one mistake companies make in the facility acquisition process is NOT ALLOWING ENOUGH TIME.

Collectively, ITRA Global members have an average of 20+ years of tenant representation experience, advising international, national and local commercial tenants in hundreds of leases totalling millions of square feet. This vast experience has shown that facility research, property inspections and comparison analysis can usually be completed in a week or so by motivated companies already familiar with the local market. However, those tasks are only the first steps in a potentially long process. Assuming the space is not going to be occupied in as-is condition, which is possible but rare, several commonly overlooked complications should be factored into the relocation timeline:

When you’re securing commercial property for your company, one of the key factors you need to bear in mind is how long you are going to sign on the lease. As with most things in life, there are expert opinions about what you should do but the ultimate decision comes down to you. So it pays to be fully informed before signing on the dotted line.

Here are a few things that you should know before you make your decision.
 

Landlords like long leases

Perhaps this is not surprising but remember that a landlord will probably have a loan. For every month the property is vacant, it’s another month they have to fund the loan from some other source. As well as this, financers are often keen to ensure that properties have secure leases as a condition of finance approval. This became increasingly evident after the global financial crisis. Stable tenancies also affect overall rental values, which in turn affects the resale value of the building. 

According to the Global Real Estate Sustainability Benchmark (GRESB), Australia and New Zealand lead the way in the global real estate market in terms of sustainability.

The report analysed data from around 637 listed property companies and private equity estate funds, which covered around 56,000 buildings, finding that Australia and New Zealand are leading the way in terms of green builds.

After a number of years of boom, when commercial tenants were often hamstrung by costly commercial leases and conditions, the pendulum has finally begun to swing in the other direction. Vacancy rates in Perth are nudging past the 10% mark and are expected to rise to around 14% by 2016.

What this means for landlords and tenants is that the rules of the game are changing. It’s not enough for landlords to simply charge what they want and expect tenants to meet the rent. It’s becoming a renter’s market and landlords are having to make concessions. Of all which is why the word ‘incentives’ is becoming so popular.

The simple fact is that most companies will only rent commercial property a small number of times during their business career. Yet conversely, landlords and commercial property agents make a living from doing it time and time again. Having the inside knowledge and market experience of an agent or landlord gives them a huge advantage in commercial property leasing, which is why so many tenants end up occupying space that is on favourable terms to the landlord.

In Australia as a whole, and Perth as a case in point, in recent years the shortage of commercial property has worked very strongly in landlords’ favour. However, a recent swing in the other direction has meant an increase in vacancy rates and desire for landlords to rent property, putting the power back in the hands of renters. However, this is only good news if you know how to use it.

Effective asset management is increasingly important for investors in the sphere of commercial property investment. Investors looking for a good return, especially in areas of the country where property values are relatively flat, understand the true value of good asset management.

If done well, property asset management can be the difference between making a profit and making a loss. Taking an innovative approach to asset management is increasingly important, as it is in other areas of commercial property strategy. Your assets should always be working hard for you, not against you, and there are various ways to make this happen.

Developing commercial property, like developing residential property, is all about the preparation. As any good painter and decorator will tell you, it’s 90% preparation to 10% finish. To achieve good end results, you have to do all the tough, gritty preparation work first. Try to rush it and you’ll be left with a poor end product - like a partially sanded wall covered in cheap paint, where you can see all the lumps and bumps.

Perhaps the most important part of preparation work you can do with any development is a feasibility study, or perhaps that should be the plural, ‘studies’, as the chances are you may need to do more than one of them.

Are you or your business unsure about moving office? Do you sense it might be time for a change but you’re looking for a definite sign that things are right for a move? Then here are five ways to help you realise that it’s time for some new commercial accommodation.

Staff expansion

At ACORPP, sustainability is one of the most important parts of what we do. It’s central to our own strategy as a company, which is why we were the first company outside of the Perth CBD to sign up to the CitySwitch program. This initiative was set up to help commercial tenants improve their sustainable credentials and achieve a higher NABERS rating.

However, from our experience, we also know that wanting to work more sustainably and actually making it happen are not always the same thing. It can be difficult to know where to start, which is why we have decided to produce this little guide to improving sustainability in your office or commercial space.

It’s ironic that the only thing that remains constant in the workplace is change. Business is in constant fluid motion following trends, responding to the fluctuations of the market place and global economy. Within a company itself, staff change, contracts come and go, and yet the company continues to exist and operate as normal.

In much the same way that it’s said around 80% of the cells in your body are replaced on an annual basis and yet you remain an individual, a company can absorb change, respond to it, react and even thrive. But the reverse is also true. Failure to adapt to change in the markets, workplace strategy and more, can leave a company in a terminally bad condition.

After a number of years of boom, when commercial tenants were often hamstrung by costly commercial leases and conditions, the pendulum has finally begun to swing in the other direction.

Vacancy rates in Perth are nudging past the 10% mark and are expected to rise to around 14% by 2016. Vacancy rates in Brisbane are currently sitting at 14.2%, which is the highest on record. With more office space currently under construction, further increases are likely. The Sydney market is sitting at 9% having remained relatively stable over the past six months and Melbourne is sitting at 9.6%, which has contracted slightly over the past year. 

ACORPP chosen for CitySwitch office sustainability case study

Here at ACORPP, we practice what we preach. That’s why we were the first company outside the CBD in Western Australia to sign up to the CitySwitch Program. CitySwitch is a service that supports commercial real estate tenants to improve their office energy efficiency, promote sustainability and achieve a four star or higher NABERS rating.

Although we work with some big clients and on some huge projects, we ourselves are a relatively small company of under 20 people. But we still felt it was very important to show leadership in the area of office sustainability. That’s why when it came to overseeing our recent Perth office move, we insisted on creating a working environment of the very highest standard.

For any sized business - including small to medium sized businesses - understanding your office space is increasingly important. Over the last couple of decades, technology has revolutionized the way we work, yet many workspaces have failed to adapt to best utilise the benefits.

An effective office space should take a number of factors into account. Get it right and you will notice a marked improvement in employee happiness, productivity and, most importantly, the bottom line. Get it wrong and you could risk stagnation. Here’s a list of six things every business needs to think about for a productive workplace. They’re all key to way we think, work and deliver here at ACORPP’s commercial property consultancy.

A United Nations Environment Programme (UNEP) report has revealed that if the global business community doesn’t raise its commitment to cutting greenhouse emissions then we may not be able to limit warming to 2˚C.

The Emissions Gap Report 2013 has found that at the present levels greenhouse gas emissions in 2020 will be around twelve gigatonnes (around one trillion kilograms) of CO2 equivalent above the necessary levels to limit warming.

Large corporate bodies have the spending power and resources to extensively research their relocation projects and represent themselves during the process. However, for some small to medium-sized businesses it is not always so easy. Without the expertise to source, arrange and complete on a property move it can become a lengthy and time-consuming process.