Top 5 costly mistakes to avoid when looking for London offices

At Find a London Office we’ve been making office deals for many years. We quite often come across sticky situations where we’re asked to step in to rectify costly mistakes. More often than not this is because office occupiers have made critical decisions in too much of a hurry or without a sound understanding of the market.

It may not surprise you that I think expert help is often very cost effective and beneficial. Experience is a huge advantage and we’ve made this journey many times before.

I don’t want to overly concern you about the dangers of taking office space, but would like to make you aware of some classic pit falls should you decide to “go it alone”!

Cultural issues – unlucky for some!

The Mistake

Some time ago we were asked by a newly appointed British MD of a Japanese bank to find a new office in the City. In our brief we were asked by our seemingly well informed client to exclude unlucky numbers.  9, 13, 42, 43 and 49 were all off limits. We conducted a comprehensive search and after discarding some great options (with potentially unlucky addresses), agreed a deal to take the entire 4th floor of building number 4.

Shortly afterwards the owners flew in from Osaka to view their new HQ. The British MD was rather embarrassed to have to tell us that number 4 – which in Japanese sounds similar to the word for death: “Shi” – was possibly the unluckiest number of all! The deal was pulled at great expense: legal fees, travel expenses, not to mention everyone’s time.

The Solution

Carefully consider cultural requirements before starting your office search. We eventually found the perfect space in a building number 8 – apparently the lucky number in Japan!

Market knowledge – its not just about the rent

The Mistake

We know of a tenant – acting for themselves – who agreed to take a 10 year lease when they probably only really needed the space for 5 years. They were advised by the letting agent they would easily be able to offload the space to another party if they wanted to leave early. Compounding the error, market conditions at the time were great for tenants, so in reality they could easily have freely negotiated a tenant’s break clause after say 3 or 5 years, which would have provided them with much more flexibility.

At the end of 5 years, the tenant predictably wanted to move, but they were stuck. And to add insult to injury they had to negotiate a 5 yearly upward only rent review before putting the office on the market. After 18 months of marketing, they found a replacement tenant and were finally able to walk away.

The Solution

The office market is complex and changes due to the economy, supply and demand. Post-Covid demands for flexibility adds yet another layer of complexity. As well as pitfalls for the inexperienced, this often creates opportunities for the well-informed tenant.

Market knowledge is critical to making informed choices. So if you don’t have that knowledge it may be well worth hiring an agent who does. Their fees will be potentially dwarfed by savings / benefits they negotiate on your behalf.

Market knowledge is critical to making informed choices. So If you don’t have that knowledge it may be well worth hiring an agent who does.

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Location and Transport Links

The Mistake

We know another office occupier who – after signing a lease on a new 25,000 ft² office – suddenly learnt that some of their key staff were super unhappy about the new location.

If you have an existing office, be very careful about changing its location radically. When you decide to accept a job, your commute is big factor in your decision. Change location after the fact and you could make life difficult for your staff. In the worst case scenario, they may look for alternative employment elsewhere. And even if they stay, your critical staff will be more likely to work from home, only visiting the office infrequently!

Be very careful about changing office location radically – you could make life very difficult for your staff.

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The Solution

A tried and tested method to choose your optimum office location is to get a map of London and mark possible new locations on it. Then identify home addresses of critical staff who you need to get into the office. Based on this analysis you can judge the relative merits of your new office’s location. Staff coming from further afield may be happy to travel to a Mainline station. However the idea of arriving at London only to have to take another tube journey to the office may be quite unattractive.

Bear in mind that newer transport facilities such as the new Elizabeth Line have made areas that were once a relatively difficult commute – e.g. office space in Paddington – are now much more accessible!

Planning ahead versus counting your pennies

The Mistake

You pay for every square foot of an office so your natural inclination will be to avoid taking more space than you need.

Having said this, I’ve sometimes seen tenants take an office to satisfy their immediate requirements, whilst ignoring the need for future expansion. This is totally understandable. However, if your judgement is wrong, you may face the cost and disruption of having to move again!

The Solution

Avoid wasting money by planning your current and future space requirements in a controlled way.

Play the “What if…” game using our office space calculator, designed by a very experienced office space planner. It really does work and is straightforward to use:

1. Enter the different spaces you need to populate your office (e.g. meeting rooms, kitchen, break out, open plan, private offices etc) and it will calculate the amount of space you need. Hybrid working means you will need to develop a clear idea of how many people will be in the office at any one time.
2. Next, choose your preferred location. You will then be provided with annual cost estimate to include rent, rates and service charge in that area.
3. Toggle between serviced offices and conventionally leased space to get an instant comparison.
4. You can experiment further by adjusting the amount of space required and you’ll get a revised annual budget.

Regrettably it won’t make the decision for you. However, with the facts at your disposal, there are much better odds on you saving time and making an informed decision.

Making assumptions about your IT requirements

Mistake

Whilst fast reliable internet is now widely available, it’s a mistake to believe that every building has the level of service a modern business demands. Secondly, flexible hybrid working only increases the need for secure, resilient IT and fast, high bandwidth connectivity. Staff working from home will need full, unimpeded access to your corporate network via VPN (Virtual Private Network).

The Solution

Check the capacity of any pre-existing infrastructure. If you discover it’s insufficient, find how long it will take to install or upgrade. Critically, ask how long it may take to get the landlord’s consent for installation work.

Final Thoughts

Fairly obviously, you can avoid all of the above mistakes by using an office agent. The London office market is complex, diverse and ever-changing.  A decent office agent will help you find office space. More importantly, however, they will bring market knowledge and experience to the party. By ensuring you avoid some basic errors, they’ll save you from possible costly consequences! Here at Find a London Office, we’d be more than happy to help.