OS Colliers Office tenant guide

Colliers Top 10 tenant mistakes

Occupier Services

06 Not clearly understanding space metrics

01 Running out of time

In Denmark, space is measured in a specific way, different from other markets. All areas of a building are lettable areas, allocated across all tenants and leaseholds in a building via the common area factor. It is important to understand exactly how much usable space you are paying for, so that you can compare options on an apples-to-apples basis. Be sure to understand and compare the different offers and determine the most suitable and space efficient option. Not ‘pre-selling’ the plan internally Multinational firms often have very long, drawn out corporate approval processes. Landlords will not always hold a space while waiting for approval from HQ, so we often see tenants losing their preferred option to another company which is able to move faster. We recommend anticipating the corporate approval process and ‘pre-selling’ the project internally to key decision makers at regular intervals during the process. This gives them the opportunity to ask questions before the end of the transaction and ensures that obtaining the final approval is quick and just a formality. Relying on the landlord’s word Too often we see negotiations carried out in good faith, with certain issues being verbally agreed to. Either through an oversight, lack of time or simply because of an assumption that the landlord’s word is good, items are not incorporated into the lease. Even if the landlord’s word is good, people move on from one

Serving notice without having secured a new lease − beginning a renewal or relocation too late

This is the biggest mistake we see corporates make. Danish office leases turn into open leases with a rolling break. There is no need to terminate until a new lease is secured, and you risk having to move out at the end of the lock-in period. Further, landlords are unlikely to offer you attractive terms for you to stay and you will be forced to accept whatever they put on the table.

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Not considering business goals before implementing real estate strategy

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Ultimately, the space you lease is there to allow you to focus on your core business. Before making a real estate decision about whether to renew or relocate, it is crucial to understand your business goals. Speak to the end users who occupy the space and ask about their goals: increasing sales, locating the office closer to their target customers? If staff retention is a concern, would it help modernising the office or relocating to be closer to amenities or public transport? Only considering the financial impact It is important to understand the cost of a particular option, but the cheapest solution does not always equal the best solution for you and your business. Savings from being in a cheaper building can quickly be

company to the next, and memories fade. Ultimately, if it matters to you, get it in writing. 08 before you run out of time and have no leverage. 09 10 Not understanding the elements of value and design Accepting that clauses are non‑negotiable because they are ‘standard’

eliminated if your operations are negatively impacted by being in that location. 03 Too many cooks will lead to delays and can derail the transaction. 04 05 Not considering future growth needs

Too many cooks! A stay or move decision will impact all staff, even if only because of a change in commute time. Clearly, it makes sense to get opinions on what is important to the various business lines and stakeholders occupying the office. Once the key selection criteria have been determined, it is important to identify a project leader. This person will have overall ownership of the stay vs go decision and will make the final recommendation.

This is what landlords might tell you; however, there is really no such thing as a standard lease. Leases are negotiable, clause by clause; just make sure that you negotiate what you want before anything is binding or

Factor in anticipated head count growth and potential changes to the business’ needs during the lease term. With lease terms that allow the company to expand, downsize (or even relocate within a landlord’s portfolio) as circumstances dictate, businesses can avoid unnecessary headaches, loss of business and relocation costs.

Even if two options appear comparable on an apples-to-apples basis, usually there will be a reason for one option being cheaper than another. Among other things, be sure to ask questions about location, accessibi- lity, s pecifications, facilities, design, management, environmental factors, sustainability, wellness, certifica tions, ownership and tenant mix. All of these can drive up or hold back rental rates.

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