Real Estate Tips for Not-For-Profits – Part 2
If you have not read Part 1 of our Real Estate Tips for Not-For-Profits, please click here.
Make Every Square Foot Count
Make sure your space is optimized for efficiency. If your furniture is more than five years old there is a very good chance you’re in too much space. If your desks and workstations are more than ten years old, then you could easily have 20% to 30% too much space. This could be a huge savings.
Not-For-Profits Are Great Tenants: Negotiate Harder
In the aftermath of the dot-com bust and the credit market crash of 2008, many commercial landlords would be hard pressed to identify a risk-free tenancy as even the big banks were at risk of defaulting. Yet many NFPs have been around for decades and, while sometimes it can feel like you never have any extra cash laying around, your proven track record speaks for itself. Suddenly a well positioned NFP tenant is in demand, so push harder and ask for lower rents and bigger cash incentives; you just might be surprised.
Ensure Your Leases Are Flexible
Many tenants are shocked to learn that you can create significant flexibility in a commercial lease through relatively simple negotiations. Options to hand back space, to sublet or share space, or even for early termination, can all provide a safety net in case all or a portion of your funding dries up.
Consider Alternative Sources of Financing
Commercial banks are typically willing to offer their clients financing for equipment but not many are aware that these same debt vehicles can be used for furniture and (very often) office space construction. In principle this works exactly like a car lease and, depending on how your organization views debt, lease financing can take the sting out of renovating or relocating your space.
Contact Real Strategy today to discuss how you can make office space more affordable for your organization.