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What to consider as a tenant taking on office space

As we emerge from the Covid-19 pandemic, with no further national restrictions, companies may be considering relocating, or re-taking, office space.

Whether that is downsizing to accommodate your new flexible working policy, increasing your space as a result of a growing business, or moving back into a new space after some time without an office, there will be some important considerations that you will want to take into account.

What is important to your business when taking on a new office space?

  1. Location
    Do you want to be in the city centre or in a regional business hub?The COVID -19 pandemic brought about dramatic changes to working life. Underutilised office space in city centres is now being repurposed for other uses.Over the last year, remote working has led to an increased demand for flexible workshare type occupation and sharing arrangements. Do you still need a presence in the city centre? Perhaps taking on office space in a regional business hub is more suitable for your business and your employees? Do you only need access to office space on an ad hoc basis? 
  1. Flexibility
    Once you have found the right office space, you want to make sure you have the right options open to you going forward. Try and agree flexible lease terms with your landlord, i.e. regular break rights in your favour, a force majeure clause, less onerous provisions to comply with making it easier to sell your lease on or take on a subtenant. As a tenant, you will want ensure you can be flexible about your occupation to adapt to the ongoing changing business demands and needs. 
  1. Relationships with Landlords
    There seems to have been changes in the dynamics of landlord and tenant relationships over the last year. These changes give potential for more emphasis on the recommendations of the new Code of Practice for commercial properties to be put into practice.  The Code encourages risk sharing and collaboration between landlords and tenants and greater flexibility with rent concessions and lease terms. 
  1. Environmental, Social and Corporate Governance (ESG)
    Considering environmental impacts and the sustainability of a building, (including water management, waste management, sustainable materials and green transport options), could be a big factor when it comes to your search for the right new office space. Occupying or investing in environmentally efficient or net zero carbon buildings can reduce energy costs, build brand value and show a commitment to Corporate Social Responsibility to company owners and employees. The social element of ESG focuses on the health and well-being of tenants and the community impact of a property.In addition, with the Government focusing more and more on the green agenda, property specific regulations like the Minimum Energy Efficiency Standards are being tightened. This means that in the future commercial premises being let are likely to need an EPC rating of at least C or above instead of the current E rating by 2025.

These are just some points to think about as a tenant taking on office space. If you have questions regarding any of the points mentioned in this blog, please contact Tanuja Sellahewa or another member of the Commercial Property team at Morr & Co.


Although correct at the time of publication, the contents of this newsletter/blog are intended for general information purposes only and shall not be deemed to be, or constitute, legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article. Please contact us for the latest legal position.

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