Friday, 29 April 2016

How Do You Determine The Space Needed To Set Up Your Office?

When you are all set to start a new business or when you are moving into a new building, the first question that strikes your mind is that, how much space you need for your office. As a business owner, you must be able to determine the amount of space you need for your office. But how would you do that? You just have to plan carefully, as too much or too little space can be the budget breakers.

Getting locked in a wrong space can interrupt your business significantly, making it difficult to operate. However, there are certain techniques employing which you can get into a right space. First of all, you need to evaluate your current situation and decide your expectations for the business growth over the next few years. Asking the following questions to yourself can help you come to a conclusion regarding the office space size.
  • How many employees are there currently?
  • Can employees share the space or they need an individual desk?
  • Do I have to add employees in the next couple of years?
  • When will I add new staff to the company?
  • What kind of employees I might be adding in future? Administrative, executive or sales?
Knowing how many employees you currently have and how many you would add in future, helps you operate your business comfortably, and you can expand your business easily without any costly interruptions. Basically, the amount of space you require is determined by the type of your business and the head count. The conventional space for an office space is about 150-350 sq. ft. per person; it is the type of the space you require to accommodate your business that plays a significant role in narrowing the range.
At the lower end of the range, we have the open plan design which has no private space for the employees; this configuration is commonly designed in the call centres and sales offices where desktops and workstations are grouped together. At the other end of the range we have traditional private office layout with cubicles around. Most of the private offices and law offices follow this configuration which has large conference rooms, support rooms, file rooms and pantry.
At the initial stage, you can keep an estimate of about 250 sq. ft. per person; calculating it for the number of current employees and also by keeping in mind the number of employee you would add in future, will give you a rough estimate of the amount of space you need. The rough estimation can further be refined and narrowed down when you start searching for space.
As the business owner, you’ll have a better understanding about the business and can easily identify the positives and negatives of a space, and determine if it suits your business well; you can choose private office, open space or the combination of both based on the nature of your business. It helps you to estimate the amount of space you would need during your lease term.

Friday, 22 April 2016

Indian Real Estate Market Sees the Highest Office Space Addition!

According to a recent study conducted by a global property consultant, Indian office space market witnessed the completion of 10 million sq. ft. during the third quarter of 2015 and the overall office space addition was the highest in 9 quarters. However the news to cheer is that, most of these supplies were pre committed to occupiers a few years back. This means that if an occupier decides to lease the space now, the propositions that are available are just a few.
Here are a few highlights of the report:
  •  The research has reported that, Bengaluru led the new supply addition while the development completions surged by 21% on a quarterly basis and around 44% on yearly basis. Also, the commercial and SEZ developments were completed across Pune, Bengaluru, Hyderabad, Gurgaon and Chennai during that quarter.
  • Looking at this report, the transaction service experts have said that, the availability of new office space continues to be minimal, as the developers are still facing difficulties of liquidity to undertake commercial real estate. But the fact is that, the supplies that are coming these days are mostly the pre-commitments made by occupiers in the past.
  • The business of commercial realty is highly leveraged because it’s not like the residential market where the customers start paying for the properties like apartments right from the planning stage of the project. In commercial real estate business, the developer can start earning only when the building is complete.
  • The consultants who are tracking the commercial real estate sector say that, it’s seeing an exactly opposite scenario to that of residential market, as the demand is outstripping the supply. According to the commercial real estate experts, the market is seeing brunt since when the developers stopped high leveraged developments (commercial buildings) after the global financial crisis.
  • Even though, the demand for office spaces is at the peak, there is a great dearth of quality office spaces. The scarcity of good office spaces continue in the prime locations. The supplies which are coming in are either of inferior quality or they are in the locations which lack infrastructure.
Office space absorption of more than 9 million sq. ft. was registered in the third quarter of 2015 across the major cities in India clocking the growth of about 20% on an annual basis. This rise in office space absorption, which is mainly driven by corporate occupiers from the sectors like IT/ITeS, finance, health care and ecommerce companies reflected a sustained improvement in the office space leasing across most cities.
However, the scarcity of Grade-A office spaces has compressed the capitalization rates significantly, and this has made the commercial real estate scenario seem better than what it was after the global financial crisis in 2008. This change is helping the developers who already have high grade office projects that are generating good income.