I am pleased to present a 2,665 sf sublease opportunity right in the heart of Downtown Atlanta located in the historic and beautiful Healey Building. With nearby parking available and excellent walkability to the Atlanta sports district, Centennial Park, Broad Street dining options and more, this sublease is perfect for you.
The suite offers:
– 2 offices
– 2 conference rooms
– 1 breakroom
– 1 open collaborative space
– 1 waiting room that could serve as a 3rd office.
– All furniture comes with the suite including the television, refrigerator, and printer.
Contact me at [email protected] for more information. Let’s go on a tour!
While touring with a client recently, many times the “vibe check” question came up in conversation. From the east side to downtown, the question remained, “What type of vibe are you looking for?” You may wonder what a vibe check is. In this instance, vibe check references the kind of energy occupiers want their employees to feel in their office space. Does an easy, laid back and walkable scenario mesh well with your company values, or does a clean and modern high rise situation align better? With the “War for Talent” upon us, office users have learned, “It’s not so much about the rent, rates and service charge anymore, it’s the story that a building can tell, if that fits the values of that
organization, which is more important.” If you want to attract and retain talent, occupiers must focus on value fit, test fit, and energy fit.
I am pleased to present a 2,665 sf sublease opportunity right in the heart of Downtown in the historic and beautiful Healey Building. With nearby parking available and excellent walkability to the Atlanta sports district, Centennial Park, Broad Street dining options and more, this sublease is perfect for you. The suite offers 2 offices, 2 conference rooms, 1 breakroom, 1 open collaborative space, and a waiting room that could serve as a 3rd office. All furniture comes with the suite including the television, refrigerator, and printer. Contact me at [email protected] for more information. Let’s go on a tour!
Being able to make sense of usable vs rentable square feet is vital for knowing how much space you are really going to get when you rent an office for your company. Knowing the difference between usable square feet and rentable square feet can mean all the difference in evaluating the best deal on a commercial lease. Office space is generally listed with a rentable square footage rate, which includes more square feet than the actual space the tenant will occupy. Having this knowledge will also help you ensure that you are getting the best possible deal on an office space and that you have an accurate idea of how much space you will be getting.
USEABLE SQUARE FEET
Let’s talk about useable square feet. The usable square feet of a space is defined as the total area unique to the tenant. Think of it as the space specifically set aside for your company’s use. Once you walk into your suite, the area inside is considered usable square feet. The calculation of this number will be slightly different for tenants leasing a full floor vs tenants leasing a partial floor. For a partial floor lease, this includes all office space plus any storage areas or private restrooms unique to your suite. It also includes space taken up by things like columns or recessed entries.
RENTABLE SQUARE FEET
Rentable square feet. Let’s talk about it. So what is rentable square feet? A commercial office building is not made up of private offices and cubicles alone. Corridors, meeting spaces, lobbies, stairways, restrooms and so on are used by all building tenants, and landlords charge for the use of this space as well. Rentable office space includes the usable square feet of the office space plus a pro-rata share of building common areas. Pro-rata means that tenants pay for these common areas in proportion to the amount of space they lease in the building.
CALCULATE RENTABLE SQUARE FEET
So how do you calculate the rentable square feet? To calculate rentable square feet, landlords use what is called a load factor (also called a common area factor, or an add-on factor). They use the load factor to figure rentable square feet for individual tenants. This number is based on the percentage of common areas found in the building. If a building has a total square footage of 100,000, with 85,000 usable square feet. This would leave 15,000 square feet of common areas and the load factor would equal to the rentable square feet divided by the usable square feet, or 1.15.
The formula for calculating load factor goes just like this:
Building Rentable Square Feet ÷ Building Usable Square Feet = Load Factor
So that would be, in this example,: 100,000 ÷ 85,000 = 1.15
This load factor is then multiplied by the individual tenants’ usable square feet to come up with the total rentable square feet. If a company desired to lease 5,000 usable square feet, for example, this number would be multiplied by the load factor of 1.15 to reach the number of rentable square feet:
The rentable square foot amount would then be multiplied by a rental rate to come up with the company’s total annual or monthly rent.
Knowing this formula helps companies to evaluate their best deal for office space. Suppose a company compared two 5,000 usable square foot office spaces with the same rental rate from two buildings with load factors of 1.15 and 1.20.
In the first building, the rent would be based on 5,750 square feet, whereas the second building would charge rent based on 6,000 square feet. The building with the lower load factor would save the company significant money.
On the other hand, the company may decide that the extra money is worth the larger, fancier lobby, or more spacious kitchenette. It could be the company’s best decision to value the amenities more than the extra cash. The important thing is for companies to do a little math and figure out exactly what they are paying for in order to make intelligent decisions about value.
Load factors, often represented as a percentage, commonly range between 10% and 20%. Often a partial-floor tenant will pay a floor common area share as well, in order to pay for use of the floor’s corridors and bathrooms, etc. The landlord will calculate the tenants usable square feet times the proportion of space the tenant occupies on the floor to come up with a floor rentable square feet figure; that number is then also multiplied by the building’s load factor.
Now you have a little extra insight into commercial real estate and how those square footage figures you see in office space listings are actually calculated. Ideally, when you are looking for a new office, you will be working with a commercial real estate broker who will be able to walk you through issues like this, but it is always smart to be informed and aware. Also note that if you see the abbreviation USF, that stands for usable square feet, and the abbreviation RSF stands for rentable square feet.
Coworking is no longer only about office leasing…it is more about an experience. Coworking spaces each have their own respective ambiance and, depending on what floats your boat, you have several options to choose from. Long gone are the days of being boxed into a traditional office space. Coworking is a new kind of product with a new mode of thought that has attracted a new kind of consumer.
This model really gives hope to the budding entrepreneur. Some start-ups have amazing potential (a solid business plan, sound projections, and sensible targets) but they do not have the capital yet. It does not mean they will not get it; it just means they just do not have it now. In order to be productive, businesses need a dedicated space to create a solid foundation.
Coworking affords the opportunity to create stability
Sometimes a company needs a coworking space because they are testing the market. Atlanta is a big slice of pie and it can be hard to determine where your market share is. While you can guess from afar, it makes more sense to get some boots on the ground to help the company move forward. Coworking creates a platform for businesses to get their feet wet in Atlanta before committing in a way that hugely impacts their bottom line.
Today’s concept of office leasing simply is not what it was 3 or 5 years ago. Companies that enter new markets, and choose coworking as an option, have a plan. They are intentional about choosing coworking as a first stop before deciding to lease traditional office space.
We are in a recession
While coworking is a great option for some business owners, there are some challenges for the coworking sector of the office market. We are in a recession and, due to all this volatility, we are at a point in the real estate cycle where we really do not know what is going to happen. This cycle is unparalleled to any other that we have experienced. Who could have imagined experiencing a pandemic in their lifetime? Not me.
Out of 50 states, Georgia is ranked #15 for population growth
We have 18 Fortune 500 companies here, and our real estate is attractive to everyone. This means businesses are coming. Coworking has been in rapid growth mode since 2016. According to a JLL survey published in the 4th quarter of 2019 on office space optimization, the average worker spends only 40% of their day at their desk and 80% of work is considered “collaborative” (that sounds like the foundation for the coworking model to me).
Flexible work space is not a passing trend…especially considering our current environment. Coworking has prepared us for these strange times by enabling us to visualize what a non-traditional office environment looks like. In fact, it is the future of our work space. I think we can all agree on that now.
What does the future of coworking look like?
Despite that fact, we need to know what the future looks like. According to Cushman & Wakefield’s 4Q20 Market Beat, in 2010, coworking leasing represented just 0.5% of all net new leasing. By 2018, the share was 9.5%. Case in point, during the 2001 recession, Regus (which had embarked on an aggressive expansion program) saw its global occupancy decline from 75%- 59% and then take three years to recover. During the Great Recession, which impacted the CRE sector far more negatively, Regus was better prepared due to its more measured expansion strategy. As a result, Regus’s memberships in the U.S. declined by 5.5% and recovered in a year. Coworking is floating in untraversed waters, however, we all are. We shall see how it all unfolds. Stay tuned.
I wanted to take a different route and talk to you guys more on a personal level about business. This year has been quite tumultuous for most people, including myself. My story is the same. Only the details are different. I think we all came into 2020 believing the turn of this decade would bring magic and wonder in the form of new opportunities…but all we’ve really seen is chaos. Who would have thought the world would end up on this path? My own journey through this has been interesting. I’ve been at three different brokerages in my career and, alas, I finally found my home. In mid-March of this year I started working as a tenant representation broker at my dream brokerage, however, my first day was the day they shut the offices down for the pandemic. It was an eerie feeling. I found myself sitting in the lobby waiting to be called upstairs and, despite that the building itself is 41-stories tall and there’s a waiting list for the parking deck, I was the only one there besides concierge and the cleaning crew. I wasn’t sure how to feel or what to expect, but I certainly didn’t think I’d be writing this blog post 3 ½ months later from my home office.
Navigating the commercial real estate industry is tough enough but when you add a pandemic plus rioting, it tends to complicate things even further. It also doesn’t help when the bulk of the rioting took place in your chosen submarket of focus. Since things are unsafe on so many levels, I usually only leave my house to buy groceries and to take clients out on tours, but I made an exception last week. A client needed assistance with site selection, so I had to venture out to my submarket of choice. I decided to bring my son, a future broker, along with me so he could take notes and get some exposure and real-life training. I thought it would be great to take him to my favorite taqueria before we got to work. I found some street parking and we started our walk to the restaurant. As we turned the corner to get to the street we were looking for, my heart sank.
Am I really not getting tacos today??
It was as if I wasn’t aware of all the rioting that took place there. Maybe on some subconscious level, I momentarily blocked out what happened in order to enjoy that moment of walking to my favorite Mexican restaurant with my son. I’m not sure what it was exactly, but when I saw at all those amazing restaurants boarded up, I became deeply sad. Knowing destruction is one thing. Experiencing it is another. Then I thought about my career. “How am I going to navigate this storm?” I couldn’t let myself get down in front of my son, so I decided to discard the bigger gloomy cloud and focus on the smaller one. “Am I really not getting tacos today??” Even though it looked like a boarded-up ghost town, I decided to start walking down the street anyway. Right as I was about to apologize to my son about the food, I saw two college students walk out of the restaurant. The joy I felt was immense (nowadays, it’s all about the little things)!
My first thought was, “Yay…I get food!” My next thoughts were about hope.
Going into that taqueria and ordering the same thing I have always ordered from the same man for the past 4 years gave me hope. It renewed my belief that there is always a positive outcome if you try hard enough. It showed me that even though there may be barriers in life right now, beautiful creations are still cooking within those walls, even if you can’t see it. It reminded me that I can find some peace and stability in this, and you can too. All you have to do…is keep walking anyway.
I heard about the sale of the CNN Center last night and I cannot stop thinking about it! The CNN Center, located in Atlanta, Georgia, is the headquarters for CNN and other WarnerMedia companies around the world. WarnerMedia, deeply rooted in the Atlanta culture, made the bold decision to sell the CNN Center and relocate operations to its newly renovated Techwood center. The change will not be immediate, and employees will remain at their present location for quite some time. This makes sense considering WarnerMedia unveiled a commissioned mural portrait of Turner at the building park late last year.
WarnerMedia plans to sell and lease back the CNN Center for at least five years in an effort to raise capital. Desroches has been working for some time to determine the highest and best use of the CNN Center and, he and his team, have ultimately decided the best course of action is to sell. Furthermore, many of CNN’s most popular, have moved to New York City.
Only time will tell…
Opened as the Omni Complex in 1976, the CNN Center has been a tourist attraction for decades, providing behind-the-scenes tours that allow an inside look at how live broadcasts are created and transmitted globally. CNN has occupied this building since 1987, when Ted Turner moved the network from the original Techwood campus. The center featured the Omni Hotel and a large food court and gift shop. On May 29th, protests over George Floyd’s death at the hands of police turned violent, resulting in damage to the exterior of the building and some part of the interior. The famous CNN sign, located at one of the main entrances, was damaged too but was fixed the next day.
It may seem that the protests sparked the decision to sell, and although the announcement was made only one month after the initial damage, that’s not the case. The decision to sell the property was made to cut costs has been in the works for years. The plan was set in motion after AT&T purchased Time Warner. Perhaps rioting and disruptions were unpleasant catalysts setting the plans into immediate action, or it was initially been projected for this time frame. Pascal Desroches, CFO of WarnerMedia, suggests that the existing CNN Center could be repurposed from an office building to have more emphasis on retail and mixed-use. That could be an amazing addition to the downtown submarket.
Over its 30+ year presence in Atlanta, the CNN Center has had a major impact on the city. Just a few years ago, in honor of the founder, the road that runs in front of the building was renamed “Ted Turner”. While they aren’t turning their back on the city, the move will displace a significant number of WarnerMedia’s 6,000 Atlanta personnel. Because of the ongoing pandemic, we probably won’t see the effects of the relocation for quite a while. Who knows? The move may very well be for Atlanta’s benefit. Only time will tell.
If you are a smart business person and have ever considered a business move that you know could take you to the next level, then consider Atlanta. It’s a good look and the right move for fast-growing companies who are looking to expand into a strong market. Atlanta has so much to offer (way too much to shove inside one article), so let’s just focus on downtown for now.
DOWNTOWN ATLANTA
You may have already heard about the amazing connectivity the Atlanta Beltline is providing and new developments are still underway. Take a look and see what’s happening in ATL!
The Beltline is slated to be connected to Centennial Park via a 3 mile trail which will be erected by the PATH Foundation.
Germany based developer, Newport, has purchased 47 properties downtown on Peachtree Street, Martin Luther King Jr Drive, Mitchell Street, and Broad Street. Newport plans to do a $500 million makeover which will give south downtown a facelift and a brand, new swagger.
The proposed Signia Hilton Hotel, designed by Gensler, is slated to kick off in late April or May soon after the NCAA Final Four Tournament.
The former Norfolk Southern Atlanta HQ is being transformed into a $70 million, 280,000 square foot adaptive-reuse project called Freight House which is conveniently located right off of Highway 20. It will house 6-7 retailers, 50,000 square feet of office space, and hundreds of new residents. This project will be hot and will link downtown and Castleberry Hill.
Underground Atlanta is also getting a “touch up”. The property will change into a $300 billion blend of apartments, student housing, and retail. It encompasses 12 underground acres plus 225,000 square feet of shopping and entertainment.
The Gulch is probably one of the city’s most awaited projects. It is being rebranded as the Centennial Yards which will be a $5 billion dollar mini city consisting of 8 million square feet of office space, 1,000 residences, 1,500 hotel rooms, and a regional mall’s worth of retail.
CAN WE SAY, “PRE-LEASE”?
We are talking about $10 billion dollars in new developments slated for downtown. In addition to that, an 8 member 501(c)(6) CPD (Central Park District) advisory committee, including major property owners as well as representation from the Atlanta Convention & Visitor’s Bureau, has been formed. They are working together to pool resources to make Atlanta more appealing to visitors and to attract more tourists.
Strengthen your brand, elevate your standards, and turn your “shoulds” into “musts”. Atlanta is where your business should must be.
Renewing a lease can be a pretty overwhelming and complex situation for corporate tenants who are accustomed to simply doing their job and not worrying about real estate. While that’s tough, it’s also a way to learn what the current market is doing and how the current position of your business can determine whether you can negotiate better lease terms moving forward.
When you truly understand your options during a lease renewal negotiation, you can be a force to be reckoned with. A tenant representation broker will arm you with market knowledge that you may not otherwise be privy to, help you to negotiate a lower rate, acquire additional amenities, and secure the best deal possible for your business.
Read on to find out more way you can ensure a good deal for your business as well as how you can protect your future commercial real estate ventures.
Negotiate Early…It Only Makes Sense
When considering a commercial real estate lease renewal, it is always best to be proactive. Evaluate your situation, determine what is and is not working for your business, and communicate with your landlord 9-12 months before your lease agreement expires. Your landlord will consider these points while reviewing your renewal and will be well aware that time is on your side – time for you to look for a new space if your concerns are not fairly considered.
In the event that you don’t have time, I’ve got you covered. What I just described is the best-case scenario, however, I have closed Class A office space deals within the span of a business week so I know it can be done. If you have a tenant representation broker who is “Johhny on the spot” and is as “quick as lightning”, then you’ve got a great teammate fighting for you. That kind of broker will alert the landlord upfront that “time is of the essence” and the deal needs to close fast. If the landlord is on board, you’ve got a great situation in front of you and even greater representation behind you.
What’s Going On With Your Current Space?
Before making any sudden decisions, take the time to analyze how your business is performing in its current commercial space. This is an opportunity to determine if the space is still suitable for your company and its future growth. Items to consider are location, amenities for employees, office configurations, and tech-enabled infrastructure. These can all serve as discussion points in the negotiation of your renewal. There is a possibility that your current landlord may incur these costs if it means keeping your company as a tenant. When you determine these factors, you can really increase your market knowledge which will facilitate an opportunity for you to have more leverage in negotiation.
Understand the Market Conditions
The commercial real estate market is dynamic, resulting in continuous changes year after year. It is important to be up-to-date on the current state of the market when looking to sign a new commercial lease or renew your current lease. Look at the market around you; are the rents similar to what you are currently paying for space? Are there other properties that offer additional benefits? Having this knowledge gives you the ability to be well informed while negotiating your current lease. If there is the potential to have some of these added benefits, lease renewal is the time to present them to your landlord.
Once you are more knowledgeable about the current market conditions, ask your tenant representative to negotiate an option or two for you. The market changes every year so it would best serve you to lock in a good rate for as long as you can. If it costs too many dollars for the same thing you had last year, it doesn’t make sense. Don’t you agree?
Research Alternative Options
Even if you are comfortable in your current commercial space, it is always beneficial to educate yourself on other buildings and owners in the market. You may determine an opportunity that is a better fit for your company. Availabilities, rental rates, and amenities have probably changed since you were last in the market, so it is worth the time to look at your options. During your research, you will become more knowledgeable about the commercial real estate market. Whether you stay in your current space or sign another commercial lease, this information can benefit your negotiation process.
Work with a Commercial Real Estate Broker to Negotiate
Do not underestimate the importance of using a broker to help you negotiate your commercial real estate lease renewals. In addition to sharing their market expertise, tenant representation brokers are always aware of the current market conditions, opportunities, owners, and other brokers. They provide you with leverage to get the incentives that you and your business deserve and have a genuine interest in seeing you win. Tenant reps know how important the right office space is for your business. An experienced broker can add value to your commercial lease renewal process, negotiate any required terms, and answer any lease related questions.
You are a successful business owner and everything is booming in your world.
Your current location has been good to you but your client base has grown dramatically. The past few years have afforded you a great proof of concept but you know you could offer your clients more. You know you need a new atmosphere and better location to best serve your clients. Where do you start? How do you accomplish that?
It sounds like you a need a tenant representation broker. A broker will find you a great new space and negotiate you a killer deal. That sounds simple enough, right? Let’s delve in a little deeper. Read on for your “no-cost-to-YOU” solution for getting a better space.
#1: YOU are the first priority
A tenant rep will have great relationships with many landlords and listing brokers. As a result, this will lead to a smooth transaction for you. Tenant representation brokers work on your behalf. They have no obligation to landlords or the buildings they present. It is their legal, fiduciary responsibility to you to evaluate buildings, locations, and leases without any bias. Additionally, they will not promote one building over another. Tenant representatives will work to position your deal in the marketplace. They will also leverage the best possible transaction both qualitatively and quantitatively. They will help your bottom line.
#2: Evaluating commercial real estate is a full-time career
In order to accurately identify lease opportunities, significant time and work goes into the process. This is time that you, like many professionals, don’t have to spare. Tenant representation brokers will determine your unique office needs and engage the market. They will analyze all alternatives and negotiate terms. Ultimately, they will find you an office space that meets your business needs. This process will ensure that you make the proper real estate decisions while paying attention to your operations.
#3: We focus on what we know so you can focus on what you do
Rather than taking time to educate yourself on the commercial real estate market, a tenant representation broker will do that for you. They can manage everything from needs assessments, parking requirements, zoning restrictions, and as well as establishing timelines and the lease execution. The decisions you make now will impact the efficiency, productivity, and profit of your organization. A tenant representation broker is sensitive to that.
#4: Tenant reps help you to determine what’s best
Defining and analyzing your business objectives will help you determine what you need in your office space. A tenant representative will apply consideration to your budget and future growth. Do your projections include expansion? Do your employees need to be near public transit? Do you need all offices on glass? Is walkability a major factor for your business model? A tenant representation broker will know all of the right questions to ask. This will help to determine the right commercial space for you.
#5: Tenant representatives have numerous resources…seriously
Searching for new space on your own can be frustrating. It is difficult to get an accurate idea of what’s available in the commercial real estate market. Many websites that have out-of-date or incomplete information. It may even be hard to get a listing broker to call you back! A tenant representative will have the most inclusive list of commercial real estate options in the market. Tenant reps have access to exclusive commercial real estate databases, industry relationships and knowledge of off-market options. This enables tenant reps to give you a variety of quality options that may not be possible to acquire on your own. If you don’t believe me, try calling a few numbers on the “For Lease” signs and see how things go. You’ll see that I’m right!
#6: Tenant Representatives will handle negotiations
Going through the negotiation process can be overwhelming. Having a tenant representative who knows the market and is exclusively representing your interests is important. They understand the need to capitalize on timing and market conditions. They will apply negotiation techniques to create the most leverage on your behalf. This will help you receive the best lease terms possible without the stress of negotiating alone. Lastly, they know the tricks of the trade which will help you.
For instance, if the market price for milk is $3.06 per gallon, you will pay $3.06 for that gallon of milk from the grocery store. If you are a vendor, you could go directly to that distributor and negotiate a much lower price point. As a vendor, you have more negotiation power. Distributors deal with vendors. HMOs deal with doctors. Landlords deal with tenant representation brokers. It’s as simple as that. Landlords will always negotiate with tenant representation brokers on your behalf. They do so because they trust the tenant rep to qualify their client before bringing them to the space. This saves the landlord a time by not having to qualify the prospective tenant upfront.
Tenant representatives can get you a ton of other incentives. Some include free rent and a break on the rental rate. They may even be able to get you more concessions!
How Much Is It Going to Cost Me?
On a final note, remember when I said you can get your space at no cost to you? Let me clarify! Tenant representation services are free because the landlord pays your representation for you. I know that sounds super crazy but that IS how this crazy thing works. The landlord sets aside a budget for representation when he/she acquires a commercial property. Whatever that budget is, is typically split down the middle. Half goes to the landlord’s representation and the other half goes to the tenant’s representation.
Why would a landlord do such a thing, you ask? A landlord is willing to pay a tenant rep’s commission because he/she feels confident that they are bringing a viable tenant to their establishment. They are willing to pay for that. I know it’s weird and I don’t make the rules…I just play by them. If you are looking for office space, I’m more than happy to point you in the right direction. I hope you found this helpful!
