By Ernesto Vilchis
Real Estate Consultant
We launched a new feature last month called Ask a Community Vision Consultant and we are so pleased to have heard from so many of you.
This month’s question: How do I prepare to search for a new space to lease for my organization?
The answer: Before beginning to search for a space to lease, there are a few basic questions your organization should answer:
- What can we afford?
- What are our space needs?
- What are our location needs?
Once you are prepared with the above information, you will be equipped for a smoother and more focused search. Let’s dive a little deeper into each question:
- What can we afford?
Assessing your organization’s financial capacity should be the first step in evaluating what your budget will be and/or whether you can afford to move. Look at your cash flow, possible new fundraising or revenue sources, your reserves, and your debt capacity. If you have positive cash flow, determine how much cash you would be able to contribute toward rent. Exploring new fundraising and/or revenue sources to put towards rent can also be useful. If you have reserves, can any of them be allocated toward tenant improvements? Lastly, if your organization can service debt (ie. you have solid reserves and healthy cash flow) it could be worth exploring your loan options for tenant improvements. - What are our space needs?
Now that you know what you can afford, you can start thinking about your space needs. Consider the number of staff, the average number of clients or beneficiaries that will be using the space, and whether your organization will be growing. How many offices and meeting spaces will you need and what types of office layouts are you open to? Also think about programming needs (storage, program space, etc.) if applicable and any amenities the organization requires such as a kitchen or parking. Co-locating or co-working are other options depending on your organization’s work and space needs. - What are our location needs?
Many mission-driven organizations are located in the communities they serve. When the need to relocate arises, these organizations sometimes have limited options when looking for a new space in the same neighborhood. If this is the case for you, and even if it isn’t, consider what the maximum radius of your search could be. What is the furthest distance that’s accessible to those you serve, your staff, and volunteers? Visiting areas you are less familiar with within your maximum radius can help determine whether the distance will be feasible. You can also make use of websites such as walkscore.com to research the walkability, transit proximity, and bike-ability of different locations.
The three guiding questions above will have you on your way to finding a space that is the best fit for your organization and those you serve.
Visit SpacesforGood.org’s resource page for more helpful information on the real estate process, financial management for nonprofits, and more.
