Choosing the right amount of office space can be tricky. Not only must the space meet your current needs, it should also be flexible enough to accommodate future growth without hindering productivity or engagement and work within your company’s budget. We spoke with Tom Greubel, Vice President of Leasing for Irvine Company Office, about why planning for growth is an essential part of workplace selection.
Why is planning for growth so important?
One common fear companies face is over committing to office space and taking on more square footage than their bottom line can support. In reality, we find that the opposite problem can sometimes be true: companies end up losing money because they have to turn down business due to insufficient space to support their expansion. They may be in a building that is full or the space that is available can’t be customized quickly enough to meet their needs. This sounds fundamental, but it’s easy to focus on expansion costs and fail to consider the lost opportunity costs associated with opting for a smaller space. Planning for growth takes this into account.
In general, how should companies think through their future space needs?
Companies should consider the impact each division has on others. For example, a growth in the sales team may trigger growth in marketing and account teams. Planning for growth can be challenging but looking at where your company wants to be and what workforce you will need to get there is a good start.
How far out should companies plan?
The larger the space required and the more specific the guidelines are for either the location or the space itself, the farther out you need to plan. In general, we see small companies with 10 to 25 people planning 6 to 12 months out. Medium-sized companies with 25 to 100 people are often planning 12 to 18 months out. And companies with more than 100 people could be looking a couple of years into the future.
How does Irvine Company work with companies on planning for growth?
We regularly meet with our customers to discuss growth plans and identify spaces that will give them the room they need to expand. We often place a customer in a location where there are smaller companies in adjacent spaces that could provide growth opportunities. Or, we also have customers that we know will be leaving at the end of their lease, creating space at the time another company will need it. For example, we are doing a deal right now with a company that is building additional space on their campus but needs a large block of space for 3 years until that space is done. That is a perfect place for us to locate a high growth company, where they will have lots of room to expand within the building.
Of course, companies do sometimes experience tremendous growth that outpaces projections. What makes Irvine Company so unique is that we have a large portfolio which allows us to find space to accommodate rapidly growing companies.
What if a company doesn’t feel like they have the ability to accurately predict their growth? For example, a start-up might experience rapid growth after investment rounds– what should they consider when choosing space?
We encourage those companies to look at our ReadyNow spaces. These are highly adaptable spaces in a variety of styles that can be lightly customized for each company’s needs. We’re able to offer shorter term leases or, if a customer unexpectedly grows out of their ReadyNow space, we can tear up their lease and put them in a larger space. This type of flexibility is very appealing to smaller companies but also ideal for large, fast growth companies like Mavenlink, which now occupies 60,000 square feet but started in a ReadyNow space.
Consult with the Irvine Company Office Properties Leasing team on your company’s growth plans.