How much space do you need for your business?

As a commercial real estate consultant, here's a questions I frequently hear. "How do I determine how much space I need for my business?" When you are considering a move for your company, or just starting out, you need to plan carefully when you calculate how much office space you need. Either too much, or too little space can be budget breakers.

Having the wrong space can interrupt your business or make it difficult to operate, but there are some techniques you can employ to get it just right. First, you need to assess your current situation, and then decide what your expectations are for the growth of your business over the next few years. Ask yourself the following questions:

• How many people do I currently employ?
• Does each employee need an individual desk or is sharing possible?
• Do I expect to add any staff in the next couple of years?
• Over what period of time will I add the staff?
• What kind of staff will I be adding, executive, administrative, or sales?

Knowing how many people you employ now helps you estimate how much space you need today to operate your business comfortably; building in your anticipated growth helps you expand your business without costly interruptions.

In general, the amount of office space you need is estimated according to head count and your industry type. The customary range for office space is 150-350 square feet (SF) per person employed. It is the type of space you need to accommodate your business that plays a large part in narrowing that range.

At the lower end of the range is the open space plan, which has no private offices. Call centers and sales offices generally use this configuration and have desks or workstations grouped together. At the high end of the range is the traditional hard-wall or private office layout. Law offices, for example, have almost all private offices, large conference rooms and support rooms such as libraries, kitchens and file rooms.

You need to determine what type of office layout suits your business best; open space, private office or a combination of both. This will allow you to accurately estimate the amount of space you will need during the term of your lease. In the initial planning process, you can estimate you will need approximately 250 square feet per person and it will provide a rough estimate of your office space needs to begin shopping for space. You can refine that further when you start narrowing down your selections and laying out your space.

Many variables, in addition to the type of space you select, play into the amount of space you need, such as floor size of the building, loss factor, or amenities in the property. Each of these variables are dealt with in the leasing guide on MySquareFeet.

At a later point, when you have narrowed down your selection of buildings, a space planner or an interior architect may be a useful part of your team of professionals to help you design the perfect space for your business. But, for your first foray into the office hunt, the general approach of using 250 square feet per person to estimate the amount of space you will occupy is all you need to begin.

Here’s an Example:
You currently employ 10 people therefore you can estimate you need approximately 2,500 square feet ("SF") of office space today. (250 SF per person X 10 people= 2,500 SF). But, you expect to add 2 new employees each year and you want to sign a three-year lease. Do you need an additional 1,500 square feet today to accommodate your growth plans?

Answer
Not necessarily. You need to determine what type of employees you will be adding. If they are senior executives that need private offices then, you will need to add closer to 1,800 square feet, (300 SF X 6 executives= 1,800 SF). But, if they are clerical support staff that will operate in a "bull pen" or open space plan then the need may be as low as 900 square feet, (150 SF x 6 employees = 900 SF) Spending time now estimating your employee growth plans could save you a significant amount of money in the future. Moving your offices mid-lease because you do not have enough space to add necessary staff can be much more expensive than building in your expected growth needs before you sign the lease.
Now that you have an idea of how much space you need you can move to the next area of consideration- your image.

MySquareFeet is the premiere commercial real estate web site where you can find space for your business, post available space you have for lease, or find answers to your questions about leasing space.

Comments

[Kerri]

Wow, this information is great! The blog looks fantastic! I'm looking forward to more posts!