LOOKING TO LEASE? LISTEN CLOSELY
Written on the 11 August 2015 by Bradley Summerson
BRISBANE'S commercial leasing market is poised at a unique point in the property cycle, creating seemingly favourable conditions - but there might be a catch.
High supply and low levels of demand have created extremely favourable conditions for prospective tenants, with many feeling it's almost impossible not to get a good deal when negotiating for premises.
This isn't necessarily the case.
Despite the good conditions, it's still important to take a strategic approach to any decisions regarding office accommodation. Prospective tenants who enter into negotiations assuming a good deal is inevitable in the current market may end up with a nasty surprise if they are too complacent.
There are a number of important factors to consider:
One of the most critical is to ensure that your accommodation supports your corporate brand. What your premises look and feel like sends a powerful message both to clients and your employees about what kind of company you are. Having the right location and office fit out can set the tone for the whole organisation.
The right office fit out can even be a tool for optimising productivity or refreshing corporate culture. Some Big Four accounting and legal firms are reducing their space requirements by implementing 'best practice' fitout designs and moving away from traditional styles and views.
It's also vital to have a clear understanding of the space you will need now and into the future. While no one knows exactly what tomorrow holds, it's important that premises be aligned with the strategic direction of the organisation.
Planning ahead can ultimately save an organisation an enormous amount of money over the longer term. Even organisations with ongoing lease arrangements should consider renegotiating an extended lease now to take advantage of the current market conditions.
All key indicators are pointing towards a pendulum swing back to conditions favouring landlords over the next four to five years, supported by business growth and a lack of new development supply at that time. Many large occupiers have already identified this and have moved to secure their premises and financial terms for the next lease cycle.
And finally, it's important to know who you're negotiating with. Lessor-focused commercial property advisers negotiate for a living even in market conditions favourable to tenants they shouldn't be underestimated.
Having said that, with the right strategy, clear objectives and good advice, there's no reason why Brisbane tenants shouldn't be able to secure a good outcome for their premises.
Author: Bradley Summerson
About: Bradley Summerson is senior director at Cushman & Wakefield. In this role Bradley works with clients in the development of independent strategic advice and delivery, providing services to tenants and occupiers in relation to their occupation and use of property.