Leasing an industrial unit

[preciousbags]

We currently rent 1700 sq foot unit but to grow we need something bigger to house more machinery more staff.

Just wanted to know how other owners decide on what size unit to go for.

I was opting for 2500-3000 sq foot but thinking long term it may be ok for another year or two but again may need to shift with growth plans later down the line.

Does it make sense to go for the 5000-6000 sq foot now?

May be tight on finances now so not sure. We have moved a lot over time and also wanting to settle.

Do you work out what you can afford based on your yearly turnover? Do landlords look at this too?

Thanks

 

[Frank the Insurance guy]

Not sure what the appetite for industrial units are in your area - if their is demand, you may want to consider a larger unit which can be sub-divided and sublet to another business - that way you will have half the rent covered and if business does grow you can move into the whole premises once the sub-letting lease runs out or reaches at break.

 

[WaveJumper]

I agree with above, a lot depends on the stock and availability within the area where you wish to operate. Units are like gold dust here especially over the 3000 sq foot. So, if you have not already done so I would do a search within a given radius and see what’s actually available and yes if you can go bigger and rent some space out as with Franks comment gives you a good bit of future proofing for your business.

 

[KM-Tiger]

If you possibly can buy a unit. In the long term line your own pockets rather than the landlord's.

Tricky I know but you won't regret.

 

[preciousbags]

I have seen a 7000 sq foot unit and a 6000 sq foot unit. Both are at our top end of affordability. When do you ask if the landlord would allow us to sublet? Before you go in with an offer? Sub letting would be good as it can help pay the bills and currently wouldn't need all of the space.

 

[WaveJumper]

I would just ask away its either in their lease's or not (as standard) I am sure they will have them already written up. If its not in there no harm in asking for it to be included but worth noting you will normally always have to refer back to the landlord in the first instance to get their approval.

 

[WaveJumper]

Also meant to add as suggested above worth exploring the option of purchasing a unit especially if you have a large pension pot to hand. There are several threads on here on this topic well worth looking into

 

[MOIC]

Is it viable to rent/buy a 3000 sq ft premises with high ceilings with a view to add a mezzanine, should extra space be required?

Renting with a view to subletting part of the premises may lead to it's own problems, whether from the landlord or legal reasons.

 

[WaveJumper]

Is it viable to rent/buy a 3000 sq ft premises with high ceilings with a view to add a mezzanine, should extra space be required?

Renting with a view to subletting part of the premises may lead to it's own problems, whether from the landlord or legal reasons.

That's a good call I like that idea

 

[preciousbags]

We have thought of installing a mezzanine - no idea what the costs would be if we went for 3000 sq ft. The problem we are finding is the shortage of units. The minute we realise one is up to let - its under offer within a few days.

 

[Chris Ashdown]

I think you will find it very hard to find a landlord who will allow sub let, as if you fail then they are lumbered with the other sub let tenant with probably no PG

Many may accept a licence to occupy where the other company has to leave at the same time and has few if any rights. but most companies would want a lease so a licence is a gamble on their long term occupying the building