REoptimizer^® Blog

Your monthly rent isn't the only cost that you need to consider when you're considering relocating or expanding your business. Occupancy costs are another ongoing expense that you need to take into consideration and account for, and with some careful planning and a little effort, it's possible to minimize these expenses to increase your profitability.

Once, office spaces were built in a way that tracked your company's organizational chart. Then, they were built in a way that would track a holocracy's org chart -- cubes for everyone. Moving forward, though, the most effective spaces use the concept of a "sense of purpose" as the underlying principle of their office design.

After about a decade of negotiation and work, the Financial Accounting Standards Board has recently issued their new set of lease accounting standards. While their original goal of creating a single global standard never got achieved since the IASB is also releasing a different new set of rules (IFRS 16 Leases), GAAP is changing to more closely track the methodology used in other parts of the world.

You've done your homework and found an office space in a prime location. You've carefully considered how much room your business will need both today and in the future, and you're confident that the space you've leased is a good fit. Sounds like your office space is guaranteed to be perfect, right? Maybe not.

When you think about technological advancements, your mind likely turns to computers, mobile devices, automobiles and other gadgets that you use in your daily life, but technology isn't just impacting the world of consumer products. Technology is having an impact on all facets of life, and commercial real estate is no exception. Advances in technology are reshaping commercial real estate to the benefit of tenants.

Recent developments in the commercial real estate world could make it seem like leasing is becoming a less attractive choice. An ongoing climate of low interest rates make purchasing less expensive while skyrocketing property values in some markets could make it seem like if you don't own, you're missing out on an opportunity to participate in appreciation. At the same time, changes in lease accounting standards are removing some of the financial benefits of leasing.

Welcome back to the final part of our trilogy on common commercial lease clauses.  If you missed them, here is Part 1 & Part 2.

The process of commercial real estate benchmarking encompasses three broad steps. First, you compare a given space to itself to see if anything has changed over time. Second, you compare it to the rest of your portfolio to see if it is an outlier in any area. Finally, you compare your portfolio to competing properties. This three step process helps you ensure that you are getting the best possible performance out of your portfolio both in terms of cost and other factors.