Finding a new home for your firm.

It is an old truism that any professional services firm's most important assets walk out the door every night. Which door they walk out of is an essential component of what makes them return in the morning. Since the decision of where to house a professional services firm affects almost every aspect of the company's operation, financial health and culture, the process used to arrive at that decision should be an intelligent and comprehensive one.

The first round of decisions in the process should address the broad parameters of which area or areas are most appropriate for your firm. The next level of decisions examines which buildings within those geographies would most effectively house the firm for both the short and long term--potentially for an excess of 10 years. There are rarely any perfect choices. However, the challenge is determining which compromises you can comfortably make while achieving the best possible solution that fits your goals.

Once the pros and cons of different locations are weighed, there are many issues to consider when comparing the specifics of Building A to the specifics of Building B. Below, are the most critical issues to evaluate when selecting a new office building for your professional services firm.

Is the building a match for the firm?

The best building needs to fit with how the firm perceives itself internally, and how it would like to be perceived externally by its clients, competitors and recruits. How does it feel when you approach the building and walk into the lobby? Is that feeling consistent with your firm's corporate culture? Assessing the building's image and its compatibility with the firm's image is one of the most important decisions in the process.

Who are the building's other tenants?

The other occupants of the building will either support or detract from the "fit" for your firm. Having other types of professional firms in the building generally indicates a high-end building with commensurate levels of service and maintenance. On-site retailers and service businesses can also be important amenities to senior managers and staff as well, and contribute to the general first impression the building makes.

How well do the floor-plates work for the firm?

Each building's floor-plates offer a unique package of trade-offs to potential tenants. The ideal configuration for a professional services firm is a rectangle which maximizes windowed offices for senior management with an appropriate amount of interior space for support functions. As a general rule of thumb, the fewer columns in a space, the better the layout.

Every firm differs in how much support space it needs for administrative staff functions and conferencing, its ratio of partner-to-associate/administrative offices, whether it is more comfortable with large floors (horizontal travel within the firm) or smaller floors (vertical travel) and the proper look and feel of its space.

The process of identifying a firm's specific needs and "test fitting" each building provides an understanding of the relative efficiencies and opportunities offered by each space being considered. The efficiencies between different sized floor-plates can be as high as 20 percent. Needless to say, having a floor that accommodates 20 percent more of the firm's operation has a significant impact on the economics of occupancy.

Is there a place to put "back office" space?

Office space is expensive. If a firm takes space on a premium floor to accommodate back office operations, it may make sense to see if there is an opportunity to put those operations in below-grade space. In turn, this space can easily reduce a firm's overall cost of occupancy. If not, many firms have success in placing these operations in off-site locations that can either be in close proximity or miles away.

Is there existing space that might work?

Building space from scratch is complicated, time-consuming and expensive (often more than $75 per square foot). While it is unusual to find space that another firm has vacated that works well without a major renovation, it can and does happen. Seeing how much can be salvaged from an earlier tenant's expense can often result in significant savings.

How well does a space accommodate change?

Many things can change over the course of a 10-year lease. As such, it is important to consider how well a building can accommodate future expansion. What kind of space can be secured through options? What space is encumbered by other tenants and their expansion rights? How easy would it be to buy-out other tenants if necessary?

Also important, is considering the reverse--needing less space or potentially none at all. Will the building be attractive to other tenants? Is there a big tenant in the building who might be in a position to take the space in the future? Does the floor-plate easily accommodate multiple tenants on a floor in the event that subleasing smaller space to several tenants is necessary? While negotiating rights to contract or sublease are important, the actual ability to do so is imperative.

Forward-thinking firms will build a "path of contraction" into their space designs. This planning considers which space will be forfeited first, anticipates a subtenant's exposure at the elevators and uses generic space design to easily facilitate bringing in a new tenant.

Parking

Is there enough? Sometimes not. How are the cars parked? Valet? Self parking? How tight is the garage? How easy is it for cars to exit the garage throughout the day and especially at rush hour? Does the street exit provide easy access to major roadways and freeways? Is there security? While different real estate markets have varying conditions that are considered normal and acceptable, professionals and staff will live with this every day--be sure that how the parking system works is well understood before making any commitments.

How well do the building's systems work?

While this should not be an issue for new buildings, for second-generation space, it is important to understand the condition of a building's systems including electrical capacity, air conditioning and heating systems, elevators, and windows. Older windows are often less efficient in maintaining warmth and cool air. Have an engineer inspect the building systems, but also talk to other tenants in the building to understand how comfortable the building actually is during the peak winter and summer months.

How well is a building managed?

Another important quality-of-life issue is how well a building is managed. While property management can change over time, knowing how a building is maintained, how fast tenant requests and issues are addressed and how other tenants rate the landlord is a worthwhile exercise.

Will anyone know you are there?

As professional services firms continue to aggressively brand themselves, the ability to obtain signage beyond a listing in the building directory is becoming increasingly important. In general, the larger the firm, the more opportunity there is to place a sign on the exterior of the building or prominently in the lobby. Because exclusive or special signage for a tenant can often be a negative when leasing to other tenants, landlords are often reticent to make this available. However, if this is important to you, know what is possible.

For many professional services firms, the process of finding a new home takes place infrequently, perhaps only every 10 or 15 years. Choosing a competent team of real estate advisors, architects, engineers and construction management experts, knowledgeable with the issues of professional services firms and of your firm in particular, can make all the difference in finding the right new home.

This information was provided by Studley, the leading commercial real estate services firm specializing in tenant representation. For more information, please contact please contact Mark Sullivan, Executive Vice President, Director and Regional Manager at 213/553-3800 or visit www.studley.com.