I was talking with a colleague who lives in Somerville and recently moved from one apartment to another. Although I lived in Somerville for many years, I don’t miss those days of renting an apartment in a city. You have to contend with raffic, pedestrians, resident parking stickers, and seemingly half the city moving from one place to another every September 1st.
In addition to the time and frustrations of those city moves in my 20’s, there are always costs to moving, even when you rely on friends for the heavy lifting.
A move in commercial real estate can come with a significant cost as well. When it comes time to exploring a move vs. a renewal, it is important to put in the time up-front to understand the out of pocket capital required and how this affects the financial analysis. Here are a handful of expenses outside of the “hard costs” of construction that are present when relocating, but often not when renewing:
– Architecture, engineering & project management fees
– Relocating (or purchasing new) furniture, phones, IT and other equipment
– Installation of tel/data wiring
– Relocating (or purchasing new) audio visual equipment
– Security (card keys, camera)
These costs can be substantial. It is important that they are recognized early in the negotiating process.
While negotiating $0.50 or $1.00 psf in rent is always important, it is also key to determine how much of an allowance a landlord is willing to give and how far that capital will go in a build out. Unless of course, someone knows a good contractor/mover who is paid in pizza and beer like the people who helped me in my 20’s.