Introduction
Ever since the COVID-19 pandemic, Chicago has been having a problem with office spaces. There are too many vacancies. They span across multiple neighborhoods and range in price from affordable to luxurious. If you’re located in the city, locating a space for your business may be easier than you think.
It appears that rent prices have fallen slightly since the summer of 2023, so finding an appropriate space in your price range shouldn’t feel impossible. The abundance of choice can make the task harder, but it’s nothing you can’t tackle. Do your research, focus on the details, and figure out your non-negotiables. To get started, follow our step-by-step guide.
Step-by-Step Guide on Renting Commercial Spaces in Chicago
There are five crucial steps to renting a commercial space in Chicago. You need to understand your needs and see where they fit within the current real estate market, set a realistic budget, and hire a broker who will help you make the right choice. Keep reading for a more detailed explanation of each step:
Determining your needs
You won’t find an optimal commercial space for your business if you don’t know exactly what that means for you. If you don’t know where to start, answer the following questions:
- Are you looking for a customer-facing space?
- How many people are going to be occupying the space?
- What is your preferred neighborhood?
- Do you need to be able to access the space using public transportation?
- How many square feet of space do you need?
- Which amenities do you need? Parking garage, gym, WiFi?..
- How long are you willing to sign the lease for?
- What are you not willing to compromise on?
This is just the start; there are many more factors you can consider. Ask your colleagues and employees to contribute to the decision-making process and propose some amenities they would like to see at work. Maybe they’ll have some great ideas about the location and size, too!
Understanding the Chicago commercial real estate market
In order to see how realistic your demands are, you need to understand the commercial real estate market in Chicago. When there are new trends at play, it’s best to do your own research to see what’s happening right now. It would be even better to consult a professional in the field of real estate and get their opinion. Before you do that, here is a quick overview of the commercial real estate market in Chicago in 2023.
The market is growing and becoming a popular destination for offices of Fortune 500 companies. Soon, Chicago is projected to compete with cities that have the best commercial real estate markets, such as New York and San Francisco.
As more companies implemented the hybrid work week as a result of the COVID-19 lockdown, the vacancy rate of offices for rent has risen. In Chicago, you can rent an office space for around $30 per square foot and a retail space for just under $20 per square foot.
Setting a realistic budget
When setting a budget, many companies are tempted to lowball and give preference to the less costly options. While that can set you up for success in terms of cutting costs, it can also land you a space that’s less than ideal for your needs.
A great starting point is doing research and compiling a list of suitable options. Keep your needs in mind, but don’t focus on the budget just yet. Find 5-10 commercial spaces that have everything you need and look at the price range. Now is the time to think about how much you can afford to spend on rent. Where does your budget fit into that range? Perhaps you’ll find you can spring for something better, or you might need to consider less expensive options.
Hiring a commercial real estate broker
Working with a skilled professional will remove half of your anxiety about making the right decision. Here are 4 benefits of working with a commercial real estate broker:
- They know the market;
- They have access to listings before they’re released to the public;
- They have connections in the field;
- They can represent you in negotiations.
After doing all that research and finding potential options, hiring a broker may seem redundant. Keep in mind that they can grant you access to listings you could never find online and do a lot more than just that. A real estate broker will have your best interest in mind. They can help you get the best value for your money, negotiate a better deal for your business, and alert your attention to issues you would never notice otherwise.
Negotiating the lease
When it’s time to negotiate the lease, you can leave most of the work up to your real estate agent. However, there are some things you need to pay attention to. For starters, consider the length of the lease. How long do you want to commit to this space for? Is there a way to back out of the lease if your circumstances change? Are there any hidden costs associated with the lease? Make sure you have a good understanding of how much you’re paying and what you’re paying for.
Once you’re presented with a written agreement, it is advisable to have a lawyer look over it to point out any risks.
Conclusion
Hiring a real estate broker means you can offload a ton of responsibilities to them, but you still have to do the work and make the final decision. Make sure you know exactly what you’re looking for and what your non-negotiables are. When the market has such an abundance of choice, determining your needs and setting a budget before beginning to work with an agent may be beneficial!
