The three L’s of real estate are Location! Location! Location! Where do I find the space I need?
Looking at your business, you will have to decide whether there is a compelling reason to locate the company in a particular region of the country, in a given city, in a certain district of that city or on a certain block.
Let’s quickly explore some of the myths and realities about selecting the best possible location for your company.
Often one reads about how tax incentives and economic development packages are decisive in getting a large company to relocate from one area to another. I have found that tax breaks are only the icing on the cake. Certain ingredients have to be in place for any given location, whether we’re talking about large corporate headquarters or a small administrative office. A location that is unattractive to your company’s key executives is a non-starter no matter how attractive the rent and taxes are. Negative factors might be employee housing that is too expensive or simply not available, the lack of quality schools, limited cultural and recreational life, long commutation or the lack of a nearby airport with international service may trump other considerations. The ability to retain and recruit quality employees is critical to a location success.
There are also industry-specific considerations. For example, some computer companies like a computer chip manufacturer or a software company might need to be located in Silicon Valley California — or Silicon Alley, New York, or in the various high-tech enclaves in Seattle, Boston or Austin. “After all, that’s where our competitors are! That’s where all the good software people are. That’s where our customers expect us to be.”
Where do your customers expect you to be? If you are like most companies, you may have built your business reputation in a local market or county. You may even be known throughout a large region or throughout an entire state. It goes without saying that no two businesses are exactly alike. A plumber might expect to handle almost all of his business in just one town. A local law firm specializing in trial law might want to be near the municipal court house, while the larger multi-practice law firms with offices throughout the country may need space in Class A buildings in a prestigious central business district location.
Secret No. 4 — You need to be where your customers expect you to be.
Some businesses may need Class A image space, such as a top accounting and stock brokerage firm. Other firms might find the glitz of Class A office space completely unnecessary and an expense they cannot afford.
Secret No. 5 — You need to be where you can afford to be and in the environment where your customers expect you to be.
Today many entrepreneurial firms are located for the convenience of the CEO. That’s right. The top guy says, “I’ve worked hard to build this business and I’m going to make this office location convenient to me.” Even if your CEO doesn’t say it out loud, you’d be surprised just how many companies’ location is chosen for this reason.
Secret No. 6 — You need to be where the boss says you will be!
Some companies rely on competitive labor and, therefore, need to be near public transportation or near a large city.
Traffic patterns also play a large part in today’s location decisions. While many employees will not have a problem with a 20 or 30 minute commute, make it an hour in bumper-to-bumper traffic, and the pain threshold may be too great.
Secret No. 7 — You need to be where you can attract quality employees.
Finding the right location may depend upon your ability to find the right kind of building amenities. Today’s more sophisticated data centers may require fiber optics, 24-hour, 7-day-a-week air conditioning, back-up generators, heavy floor loads, and high power. Some companies have a heavy parking ratio like medical offices or telecommunication firms. Others are concerned about high security for their employees, a cafeteria for the employees, or a health club.
Secret No. 8 — Make a complete list of your company’s hot buttons, those which are essential to doing business or being competitive, before you start looking for properties. By knowing your company’s unique location criteria, you are in a much better position to begin evaluating available market alternatives when they are presented to you.
Decide which factors are essential in your situation, and don’t compromise on those when you select a location.
Categorised in: Location