Office Space FAQ

Do Dilapidations Apply?

In some office lease contracts, there's a clause that requires tenants to restore the premises to the exact condition they were in at the start of the lease. If you made changes or additions to the layout or changed the distribution of the office space, you may need to pay for the cost of restoring it to its initial state. Dilapidations expenses also include the removal of carpets, furniture, partitions, and repairing any wear and tear that happened during your tenancy.

Will You Need to Pay for Stamp Duty?

Stamp duty is a UK tax that applies to the purchase of both residential and commercial properties. In the case of office relocations, you may be liable to pay this tax if new premises are acquired on freehold or leasehold, the latter being common with office-based businesses. Because stamp duty isn't a fixed amount, instead varying depending on property type and value, the cost needs to be calculated to make sure it can be covered without being too much of a burden on cash flow. Various online stamp duty calculators exist, such as the one found here.

Have You Discussed the Move with Your Employees?

Your staff uses the office on a daily basis, hence, any suggestions they may be able to provide related to their workspace, equipment, and nearby amenities, should be taken with the utmost consideration. Discussing the move with your staff may bring to attention things you had overlooked. It's vital to ensure that communication between you and your team flows before the move.

Can You Transfer Your Insurance?

Office insurance may be mandatory depending on the nature of your business and the number of employees. Check your existing policy to see if you can transfer cover to the new premises. Having public liability insurance may be needed before you can even sign a new lease or rental contract.

What are the Business Rates in the New Location?

Business rates are not standard and are reviewed by the local city council on an annual basis. However, you can look back at past years' rate increases to get an idea of upcoming costs in the medium term.

Will the New Office need to be Fitted Out?

When visiting a potential office, ask yourself if the space suits your needs as is. Anything outside of minimal changes to the interior will require fit out or refurbishment work. This will not only delay the move in date but also end up being potentially costly depending on your needs. If a fit out is required, it's important to think about the scope. Fit out work usually falls into three categories:

- Shell and core: work affecting the building structure.
- Category A: lighting, electrical, floors and ceilings, and HVAC systems.
- Category B: mostly furnishing and decorating.

Each of these can be completed to basic, mid-range, or high-end standards. An outline of average fit out costs can be found here.

Will the New Location and Space Match Your Office Culture?

Making changes to a company's location and workspace can disrupt elements of corporate culture and affect overall productivity. To avoid this, think about what elements are central to your company's culture and whether the new office environment can support and cultivate those elements.