Choosing the right office space is one of the most important decisions a business owner can make. Yet, many overestimate how much space they truly need, often leading to unnecessary overhead costs. The reality is that with the evolution of flexible work and the rise of coworking spaces, you can lease less private square footage while gaining access to more usable space overall—without sacrificing productivity or professionalism and saving dramatically on costs.

Many business owners will begin their search for office space thinking they need to lease an entire wing and grant each employee with their own private office, not realizing that to often acquire commercial spaces over 1,000 square feet come with a minimum of 3 to 5 year lease terms, utility bills, common area maintenance charges, responsibilities of the tenant for repairs, annual inflation based rent increases, and then their actual rent that can range from $20 to $35 per square foot annually (1,000 square feet multiplied by $35 per square foot equaling $2,916 per month in rent before the above mentioned expenses, which could easily push the total monthly bill to $3500-$4000 per month).

Compare the $3500 per month for 5-years ($210,000 total) to leasing a 200 square foot office within a coworking space that grants you access to an addition 5,000 square foot of workspace at a flat $900 per month on a flexible 1-year lease term ($10,800 annual or $54,000 over 5-years). There is a ~$150,000 net savings to ultimately have access to 5 times the physical space that is most likely higher end and kept up by a more engaged facility management team.

The intent of this article is to help you consider how much space you may actually need for your growing team and to open your search to more than just traditional office spaces that may not fully meet your needs, while charging you far more.

9 Considerations For Planning Your Next Office Space

1. Headcount (Now and Near-Term Future)

Start with your current team and consider your realistic growth over the next 12–24 months. Signing a 3-to-5-year lease for a space that fits your team now but not 1-year from now happens to a lot of growing businesses, leading to an expensive break of their lease, being held captive to potentially avoid growing, or worst of all, having two leases at once. Having flexibility to work within a space that can scale with your operation without wrecking your budget is essential.

2. Work Style Mix (In-Office, In-Field, Frequency)

It isn’t always the case that everyone on your team is in-office every day. Therefore, you can avoid paying every day for square footage that team members only need on a part-time or infrequent basis, while prioritizing paying for square footage for team members who have daily need. A great example would be a team of 10 composed of an owner, an administrator, and 8 employees composed of sales representatives or field supervisors. In this example, leasing an affordable office for 2 that provides access to boardroom meeting space for 10 and open workspace for sales reps and supervisors to leverage when needed would cost a fraction of signing a long-term lease for a 10-person office elsewhere. Blending head count and with actual team regular needs will inform an owner more on what the right space is for their team at the best price.

3. Privacy and Confidentiality Requirements

Do you need private offices for leadership, HR, or confidential meetings? In coworking environments, private suites and reservable boardrooms can meet these needs without increasing your lease size. Similarly, offices within coworking spaces can offer private VLAN and Wi-Fi services at significantly reduced costs compared to the business procuring those services on their own to help increase digital security and privacy.

4. Meeting Frequency & Type

Do you host clients or conduct regular internal meetings? In traditional leases, you’d need to build out extra meeting rooms. In a coworking space, shared boardrooms, phone booths, and meeting rooms cover that need—freeing up your leased space. This lets a business owner optimize their leased space for their operation while leaning on the coworking facility to provide state of the art and aesthetically appealing client facing meeting spaces that would most likely be above and beyond what the business owner could buildout for themselves.

5. Storage Needs

In the event that a business had physical storage needs, many coworking facilities have auxiliary space that members can lease out, in alignment with their more flexible office lease, for very affordable rates. Conversely, if a business owner has a very large storage need and a very small office or workspace need, they can leverage an affordable smaller office within a coworking space, while paying an affordable rate on a public storage space rather than trying to find a customizable space that would blend the two at ultimately a higher price point and longer lease term.

6. Lounge & Break Spaces

In a traditional office lease, you’d need to allocate room for kitchens and lounges. In coworking environments, communal cafés, lounges, and relaxation zones are included—giving your team more amenities with less cost. Often the coworking space provides things like high end coffee, filtered water, refrigeration, microwaves, dishwashers, ovens, and an assortment of offerings that many business owners don’t consider purchasing when setting up their traditional office space.

7. Growth & Flexibility

Leasing too much space upfront “just in case” can lock up capital. Coworking spaces offer flexible leases, often month-to-month, so you can grow or contract as your business evolves.

8. Impression & Experience

Will clients or partners visit your space? The impression of a beautifully designed coworking space—with modern lobbies, art, and design—can outshine traditional square footage in a nondescript office tower.

9. Cost per Square Foot vs. Value per Square Foot

At the end of the day, business owners look at the budget to determine a lot of their decisions. It is in their interest to choose a space that maximizes their needs while minimizing the stress on their bank account. Instead of just calculating cost per square foot, think about value per usable square foot. A 200-square-foot private office within a coworking space may unlock access to over 5,000 shared square feet that is ultimately more tailored to your immediate and long-term operational and financial needs than locking up a 1,000+ square foot space for half a decade.

How Does Refinery46 Help Business Owners Pick The Right Office Space?

We take time to understand each business that inquires for workspace with our facility. Being a small business ourselves, we understand that the world of commercial real estate is rarely forthcoming and transparent in their offerings, lease terms and conditions. Our aim is to help bridge the knowledge gap that exists between our industry and the small business ecosystem. If you are searching for your next office or workspace, tour our facility and let us collaborate with you on what you and your business actually needs. If your needs align with our offering, amazing! If not, we will be the first to recommend you to other contacts we have in the city that may be able to fit your needs.

Interested in getting started? Contact our team at Refinery46 today by giving us a call at (463) 946-0017 or Schedule a Tour today!