Site Selection: Looking for premises?

Get your site selection for your business premises right

“Until comparatively recently many, if not most locations were chosen on the basis of gut feel, obscure rules of thumb or, if it was a really important decision, by means of licking of finger and holding it up to the wind”  [Rogers 1987]

Looking for premises for your business can be a real challenge, especially if you’re new to the process. There is so much to consider—location, price, size, lease terms—and everything is as important as everything else. It’s easy to make mistakes or overlook crucial details that can affect your business’s success in the long run.

Putting one foot wrong could be all it takes to kill your business entirely.

Common Site Selection Mistakes

In this article, I’ll be outlining the nine most common site selection mistakes tenants make when looking for commercial premises for their business.

1. Failing to identify your specific needs

Do you know what you need? I mean really know what you need? Each business has unique requirements, and failing to identify them can lead to renting unsuitable premises. Before you begin your search, consider your business needs and goals. Think about your ideal location, size, layout, parking, and other essential amenities. It’s not so much about what you might want or like – it’s about what you need.

2. Focusing solely on the rental price

While rental prices are a critical factor to consider, focusing solely on price can be a mistake. Choosing the cheapest commercial premises may save you money initially, but it can lead to issues such as poor location, inadequate facilities, or unfavourable lease terms. Instead, consider your budget and the value you’ll be getting for the price. You must find premises that offer reasonable rental rates while still meeting your specific needs – and that may not mean the cheapest.

3. Ignoring lease terms

Lease terms are often overlooked when searching for commercial premises, yet they can have significant impacts on your business’s success. Before signing a lease, make sure to read and understand all the terms and conditions. Some of the critical details to look out for include lease length, rent reviews, maintenance responsibilities, subletting, guarantee provisions, reinstatement obligations, and early termination clauses. Understanding your lease terms will help you avoid unpleasant – and possible business-closing – surprises.

4. Choosing the wrong location

Location is critical for any business, and choosing the wrong one can lead to failure. Tenants often make the mistake of choosing a location that’s convenient for them but not for their customers. Consider the accessibility, visibility, and competition in the area before making a decision. A well-chosen strategic location will attract and retain customers and grow your business.

5. Underestimating the importance of parking or delivery access

Parking is often overlooked when searching for commercial premises, yet it’s a crucial factor to consider. Customers are more likely to visit your business if there’s ample parking available. Make sure the premises you’re considering have enough parking space for your customers, employees, and deliveries.

6. Failing to inspect the premises thoroughly

Never rent commercial premises without inspecting them thoroughly. Leaking roofs, faulty plumbing, defective building services… these (and an arm-length list of other nasty surprises) don’t tend to be itemised in a lease, or highlighted in the listing photos.

Addressing any issues before leasing can save you money and avoid future headaches.

7. Not considering future growth

You probably want your business to grow in the future – but it probably won’t if you don’t make room for it. 

Make sure to choose premises that can accommodate your future needs, such as extra space, additional parking, or a larger customer base. The last thing you want is to spend time and money sorting a lease, only to be quickly back at square one when you outgrow the premises. 

8. Failing to negotiate lease terms

Negotiating lease terms can save you money and provide more favourable conditions for your business. Tenants often make the mistake of accepting lease terms as they are, without attempting to negotiate. Before signing a lease, consider negotiating lease length, rent increases, maintenance responsibilities, or any other terms that may affect your business. 

9. Not seeking professional advice or taking “free” advice

Finally, tenants often make the mistake of not seeking professional advice when searching for commercial premises.

We all know the saying, “There is no such thing as a free lunch”. Yes, it’s a cliché – but clichés only become clichés when they are proven true.

Taking free advice usually means that we pay in kind through suboptimal decision-making. Before you rely on free location or site selection advice provided by the listing agent, remember this… listing agents earn their money by getting the best possible deal for the landlord – in other words, the worst possible deal for you.

Also remember that “free” tenant representatives who are engaged by you to act on your behalf, but arrange for their fee to be paid by your prospective landlord, are potentially compromised. Their fee will be wrapped up in the deal that is struck with your landlord. That cost is factored into the leasing deal negotiated by the landlord with your “free” tenant representative.

The only way to avoid conflicts of interest and to ensure that a Property Advisor is working exclusively in your interests is to retain them and remunerate them directly. In other words, own your own Property Advisor.

We are independent property advisors who specialise in site selection strategies to find premises and in lease negotiation to unlock the potential of property for our clients.

We want to see you get the right premise, in the right location, in the right catchment, for your business on the best commercial terms with speed and efficiency.

Consulting with a Property Advisor will provide valuable insights, help you avoid potential pitfalls… and save you money.