The most important information about renting office space. Read it here!
- Wednesday, January 29, 2020
When you are going to rent office space as an entrepreneur, it is not only important to find a location that meets your wants and needs, the content of the lease must also match your organization. In this blog, the most important information regarding a rental agreement is explained so that you can put your signature on the rental agreement without any doubts or reservations.
Most important information office space
- Rental prices are on average from €250 to €600 per square meter per year;
- These prices can be communicated as an all-in rental price or rent in m2 per year;
- An all-in rental price for office space results in paying a fixed amount per month;
- A rental price per m2 per year is also called 'basic rent';
- It is often more advantageous for both the landlord and tenant to tax the office space with VAT;
- Most landlords expect you to pay a deposit, usually the size of 1 to 3 months of rent.
The differences in rental prices of office spaces
It is often difficult to compare the various rental prices of office spaces. One landlord communicates an all-in rental price while another states the rent in m2 per year. It is therefore important to have a good overview of what is included in the rent per location and which kind of pricing offers the most benefits for your company.
An all-in rental price
When a landlord states an all-in rental price for office space, you pay a fixed amount per month. Meaning that you will not be confronted with unpleasant surprises every month. The utilities (gas, water and electricity) are included in an all-in rental price. Phone services and internet are often included in the rental price as well, which allows you to use the reception services, the general areas and the flex desks entirely free of charge.
Usually, a fixed amount per month is agreed upon for extra services. The extra services that are included are for example; coffee and tea, cleaning your office space, printing and scanning, parking, furniture and the number of hours that you can freely use the meeting rooms.
When renting office space with a fixed all-in price per month it could be possible to use all the services in an office building. Whether or not this is an option for your company depends on several factors, such as your budget, the number of people working in the office and whether or not you prefer to entirely manage these services yourself.
Of course, it is possible to not pay for extra services to be included in a fixed monthly rental price as well. In this case, you will have to take care of these things yourself and in turn, gain the possibility to entirely manage the process yourself. Meaning that you could spend as much or as little on a certain service as you see fit.
A rental price per m2 per year
A rental price per m2 per year is also called 'basic rent'. With basic rent, you pay a certain amount per m2 per year and also a certain amount for the service costs per m2 per year. This pricing format is mainly offered for office spaces with large areas such as 100 m2 or more.
Renting an office space per m2 per year often seems cheaper, but as a company, you will have to invest a lot more in the office space because the office spaces are often not ready to use right away. Therefore, this kind of pricing is ideal for companies who would like to express their own corporate identity and would like to incorporate this into their office space. It is less ideal for companies who are looking for a flexible rental solution. Office spaces with a rental price per m2 per year usually have a rental contract of at least 12 months.
Would you like to know more about the possibility to rent office space for a fixed price per square meter? In that case, consult our know-how article called “Rental price per m2, how many square meters of office space do you need?”. Aside from that, you can also contact one of our real estate consultants, completely free of charge. They can immediately tell you which locations are the most suitable for you! You can reach them at +31 85 888 2339 by phone or contacting firstname.lastname@example.org by email.
As mentioned before, there is usually a service charge in addition to the rental price of office space. Basic rent usually means that you pay a fixed price per month without any extra services, with an all-in price the service costs have already been included in the rental price per workplace. These service costs usually consist of the costs for heating, water and electricity for the communal spaces, as well as security and maintenance of the building. Furthermore, the usage of the building’s WiFi network is also included in service costs.
Taxes on renting office space, take advantage of it!
Generally, you do not have to pay value-added tax (VAT) on your rented office space, because the rental of business premises is exempt from VAT. Nevertheless, it is often more advantageous for both the landlord and tenant to tax the office space with VAT. Would you like to know more about this? Then read the white paper “How to benefit from VAT-taxed rental prices” in the knowledge base.
Besides the first monthly rental payment, most landlords are also expecting you to pay a deposit. This ensures the landlord that he or she has a certain monthly income and the money could be used to draw from using certain disputes. The total amount of the deposit varies per landlord but there are limits as to the maximum of a possible deposit. A deposit of up to 3 months of basic rent is considered reasonable.
The best rental period for your office space
In addition to the starting date, it is, of course, important to have insights into what the duration of the agreement is, how and when you must cancel and how many months the contract will be extended if you do not cancel the rental agreement. You can consult the landlord about the desired rental period for your office space. A rental period of 12 months is the most common, but you can also opt for more flexibility.
With a more flexible lease term, there is a chance that the rent will be increased. So if you want the best rental price, then we advise you to sign for at least 1 year. Do you want to know which lease term is the most ideal for your company? And do you want to know which cancellation period is used for which rental agreement period? Consult the knowledge base about “Rental information” to find out more!
Do you want the cheapest rental price, but do you find it difficult to estimate the extent to which your company will grow in the coming years? No problem, there are a few options for cancelling your rental agreement earlier. For example, you could include a break-option clause in the agreement. This will give you the option to cancel the agreement before the contract has ended.
Aside from that, it is also possible to sublet your office space, which means that you can maintain your current contract and rent out the office space to a different party. Subletting your office space does result in you bearing the risks for the successful rent of the office. Because of that, it is debatable whether or not this is a more preferable solution than finding a flexible rental solution.
When you have found the perfect office space and you agree with the landlord on the content of the rental agreement, it is time to sign the contract. Make sure you always enter into an agreement in writing and that all clauses are clearly stated in the contract. This way you can prevent future disputes. Do you have any questions about the provisions in your rental agreement or are you unable to find the right space? Our real estate consultants are happy to help you in your search for office space, completely free of charge and without any obligations.