5 Reasons You Should Lease Office Space
One of the things that you will need to determine when opening a brick-and-mortar location for your business is whether you should lease or buy the office space. Both buying and leasing office space can offer you benefits and have potential problems that you will need to consider, but in many cases, it can be a lot easier for your small business to lease. Some of the reasons you may have for leasing include suitability, repairs and credit.
For smaller companies, especially those without a lot of product to store, buying property will mean having more square footage than you can handle. By looking at the leasing options available, you can find a suitable property that is ready to move into.
Leasing office space means that the repairs needed to the office are usually the responsibility of the landlord. This is especially true for things like broken pipes, storm damage or even aging fixtures and wiring.
With leasing, you can have greater flexibility over owning. This lets you more quickly, and inexpensively, change locations as needed. For instance, if your company grows outside of the confines of your space, then you can find a new location to lease once your contract is up. If you own the space and need to move to grow, then you will need to not only find a new location, but also find someone to take over the space that you are leaving.
Leasing office space has less to do with your business credit score than owning a property. This is because you will be judged on how many on-time payments you have instead of how much debt your company is in from purchasing property. To lease a space, you will generally not need a large down payment or to take a property loan. For some companies, this can mean a better ability to open unsecured lines of credit or take on expansion loans.
Owning property has an increased tax burden for most companies. Some of that burden can be offset by deductions on the state and federal level, but it can still be hire than if you were leasing a space. The easiest way to reduce your tax burden is to meet with a professional, but leasing a space instead of buying one may be one of the things that he or she suggests.
Leasing office space can offer you many benefits, particularly if you are a small business owner. By leasing, you can more easily move as you outgrow the space, have less of an impact on your credit and much more.