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Construction Considerations When Subleasing Office Space

We’ve recently heard from several clients that are reevaluating their office space needs after embracing flexible work policies. One option many are thinking through is subleasing space from another firm. There can be a lot of benefits to this, but there are still considerations that vary depending on your industry and what employees need to get the job done well.

For example, we recently completed the renovation of a subleased space for a trading firm. They need what all companies need – private and open offices, a kitchen, meeting rooms – but they also have extensive data and power requirements. A typical sublease would not give them that and they had to consider the costs of adding that infrastructure when making their location and programming decisions.

Our Principal and Preconstruction Lead, Isaac Chinwalla, has put together a brief run-down of sublease considerations we work through when our clients ask for advice from a construction perspective.

 

1. Find Space That is Similarly Programmed - The most cost-effective sublease space already has the bones needed to run your operation. Finding space that has the same composition of private offices, conference rooms, and open office as your program requires means minimizing costs associated with demolition of unwanted areas, addition of rooms, and modifications to the HVAC and lighting systems that are costly.

2. Find Space Built by a Company in a Similar Industry - The short lease terms and lack or absence of a TI allowance make function and cost a priority for subtenants. One of the struggles can be balancing cost saving measures with making the space feel like your own.

Just as it makes sense to find a layout that is compatible with your program, it can be an added win when the sublease you are taking is from a company in a similar market sector. For example, financial services firms would have less work to do aesthetically if they sublease from other financial services firms or professional services firms. Tech clients seeking energetic and open space would do best to avoid subleasing from a traditional wealth management firm. Aligning style up front can allow a few coats of paint and signage to rebrand a space much more effectively.

3. Ask Questions About Undemised Space - If presented with a space that can be demised but has not yet been split up it is important to weigh the full scope of work. Will the sectioned off space have all the basic requirements of traditional office space – an entry, a reception, a café or pantry, an IT room or area, and a copy/print area? If reusing workstations and offices, is the data wiring currently connected to space outside of your sublease? Will a corridor need to be built to meet egress requirements from the city? Working with a space planner and contractor upfront to determine these issues can be key in avoiding cost over runs.

4. Know Your Data - Space that may look ready to use is often not turnkey. It is common for low voltage data cabling, wireless access points, and server room infrastructure to be removed when a tenant moves out. Work with your IT team and contractor to understand what your data and power needs will be and confirm the infrastructure is in place and what replacement or upgrade costs may be.

5. Confirm What Stays - Confirm with the current tenant what they intend to leave in the space in detail. Furniture, chairs, file cabinets, artwork, and IT equipment cannot be assumed to remain in place unless noted in the lease and agreed upon. Conversely if you are buying new furniture or moving your existing, confirm who will disassemble and remove the existing furniture from the space.

 

As BIG Construction, we’re best equipped to answer questions about office space construction and so have created a pricing and lead time document as a first point of reference when considering subleasing part of your space to another company.

You can view and download that document here.

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