Because so many developers and landlords have more square footage than they know what to do with, now is a good time to assess your company's space needs. Office space is going begging in both cities and suburbia, and there could hardly be a better opportunity to drive a hard bargain.
For companies that occupy most of their buildings -- and expect to need the extra space in the future -- it may be smart to negotiate a good purchase contract, says Lloyd Lynford, president of REIS Reports, a New York City -- based real estate research and database firm. But, he warns, because of the space glut, it may be hard to sublet the extra space in the meantime.
If your company is leasing, it is definitely the time to consider what your options are. To fill their buildings, landlords are willing to make more concessions than at any period in recent memory. They may offer months of free space, provide free parking, or fix the place up to your specifications. And, the longer the lease, the more concessions they are likely to make. Still, advises Glenn Whitmore, of Coldwell Banker in New York City, "Don't get visions of sugarplums about concessions you may get. Think of where you want to be, not where you can get the cheapest deal. Your focus should be on where you real want to locate."
"Do your homework first," says consultant Linda Goodman, of Real Estate Research Corp., in Chicago. "Know your space needs short and long term. How many employees do you think you will have in 1990? Then consider whether you will have more executives who will need corner offices, or clerks who will use more 'bullpen' space. Do you have a good relationship with your landlord now? Do you have clout now because you're a major tenant in a smaller building? What will it cost to move? How distruptive would it be?" Goodman's final advice: "Find someone to help you do an analysis. A sophisticated tenant will be able to bargain for more."