Clockwork founder Christian Arnold: When to explore new workspace for your startup

Editor’s note: The opinions expressed in this commentary are the author’s alone.

If your startup is ready to graduate from your home office and the local coffee shop, you have a lot of considerations for that perfect workspace.

Yes, real estate is typically the second highest business cost, but the right space has the power to attract top talent, increase staff performance and effectively communicate your brand and culture to every potential customer.

We have many great coworking, incubator and accelerator options, and a simple online search will get you headed in the right direction. Of course, as your business grows, it will likely be more cost effective to find your own space, but try to hold off as long as possible. Established credit ratings and financials make this process less painful and will provide more leverage when negotiating terms.

Then, when you’re ready, you’ll be able to start off on the right foot. For that, you’ll need a solid team to guide you. You might be tempted to do it yourself it, but much like surgery, this is best left in the hands of a professional.

First, you’ll need a broker. Look for one who specializes in tenant representation, which will allow him or her to better negotiate on your behalf without any conflicts of interest of a listing broker. A typical brokerage fee is 6 percent of the lease.

Next up? Good legal counsel. An attorney who specializes in real estate can provide valuable information in the language of the lease and let you know if the terms are standard or weighted against you.

Finally, be sure to add an experienced architect to the team — and make sure you find one who’s a leader in your project type. As the person responsible for planning, designing and reviewing the construction of your workspace, a good architect — one who specializes in commercial office projects — can save you money and help you create a space that’s not only functional but also reflects your brand and purpose. You’ll also need a licensed architect to prepare and sign the drawings for you to obtain a construction permit. Your landlord will often cover all or a portion of these fees as part of the lease.

Once you’re armed with a team of experienced partners, here are some valuable steps to keep in mind.

Space planning – Start with the number of offices you need and remember that every inch of wall and every door adds cost. You may need to adjust or re-invent in the next few months, so consider multi-purpose spaces that allow flexibility. Several online calculators are available to help you plan, and most good architects have their own proprietary tool.

 Location – Always consider at least three spaces, and leverage them against each other to get the best deal.

Test fit – This is when your architect translates your space needs into a floor plan. This gives you the chance to evaluate the efficiency of your property choices and compare the costs of each.

Budgeting – Now that you’ve chosen your space, the contractor can prepare some basic budgeting to assist with the negotiations of the lease terms. Be sure to ask about tenant improvement allowance, which is money the landlord will contribute to cover some or all of the construction costs.

Negotiation – Your broker will use the information collected by your architect to negotiate on your behalf — a fluid process that may take a couple weeks or even a couple months, depending on the deal’s complexity.

Design – Your architect will guide you through the process of choosing workstations, furniture, mobile walls, lighting, flooring and more. The architect will also coordinate with the plumber, mechanical engineer and electrical engineer to record the appropriate details that will allow the contractor to provide an accurate estimate.

Bidding – Now that you have complete construction documents, be sure to get multiple estimates. Your architect can help you understand and compare each — a process that’s worth its weight in gold. Everyone makes different assumptions as part of this process, but a good architect can translate all these assumptions and “allowances” to see what you’re actually going to get.

Construction – During this process, work through the details and request a schedule, and be sure to include a schedule contingency and any penalties if it’s imperative to hit certain milestones. Upon completion of the construction, your architect will review a “punch list” of items to be completed. Once approved, a notice of “substantial completion” will be given, which will trigger the beginning of rent, warranties, etc.

If managed correctly the end result will be a powerful recruiting and retention tool. In the hands of the right strategic team, the brand integration, color, texture, lighting and location of your new space can make a significant difference and deliver a measurable ROI to your growing startup.

Christian Arnold is the founding principal of Clockwork, an architecture + branding agency that has worked with all types of companies – from startups to Google and Tesla – to find solutions where others only saw problems. Connect on LinkedIn, Twitter or see more at clockwork-ad.com