What are your options for office leasing in Korea?
So, your lease is expiring in 12 months’ time and you’re wondering where your office should be located for the next few years. The good news is that you’ve got options. The bad news is that you’ve got options! Below is a straight forward guide to evaluating these options and how to decide the best way forward.
Renew your current lease – Status Quo
Staying put is nearly always considered the base case. Unless your landlord does not want to renew your lease and you do not have the right to do so (by way of a renewal option), your first consideration may be to renew your existing tenancy agreement as is.
You should first ask yourself though if your current premises still checks all the boxes that it did when you originally moved in:
Renew and restack
If the building, location and the rental rate are still good, but the interior of your office could do with more than just a lick of paint, you could consider renewing your lease but re-fitting the office. Whilst this does offer the opportunity to modernize and set-up the office to align with an innovative workplace, it can be very disruptive. Thankfully there are flexible, short-term options such as serviced offices or coworking spaces that can act as a ‘swing-space’ for a few months while construction takes place.
The expiration of your lease could offer you an opportunity to transform your business and create new efficiencies by relocating to a new premises. A new office can strengthen your employees’ sense of brand as well as communicate your core values to customers and other stakeholders. It could also place you closer to target customers or amenities.
If you occupy multiple sites, you may wish to review the potential to consolidate operations to a single location to take advantage of operational efficiencies and reduced space. If you are combining two offices into one, for example, you would only need one reception, one server room and one pantry, which translates into lower operational costs for your business. Also, bear in mind that a larger office space will create greater negotiation leverage with the landlord, so some of the items you may not have been able to get in your previous lease might be possible this time.
If you occupy a large area at one location, you may consider the potential to split front and back office operations. This could allow you to take advantage of lower rents for back office operations outside of the Central Business District.
Bringing it all together, ultimately it comes down to what is the best for the business. Your real estate broker will be able to guide you through your options as well as the process and timing. Combining this expertise together with your business’ requirements will ensure the optimal decision is reached.
For more information on the office leasing process, our Korea office leasing guide will be released soon. The guide details the renewal vs. relocation process in step-by-step terms, gives details on the specific market practices in Korea and demystifies some of the industry jargon. It is an essential handbook to help you make a major business transition, whether your decision is to renew or relocate, with minimum disruption.