The Leasing Process - Part 2 - Functionality Main Boise Valley Commercial Real Estate
Leasing space, whether that be office, industrial / warehouse, or retail space involves a lot of thought on the part of the tenant. If you're in the retail business, but need some warehousing, you might want to consider "flex" space. If you need a warehouse and are looking for low rent, make sure you don't need 3-phase power. All users have a priority list of needs - whether they've realized it or not. Let's discuss a few of those so your experience will be a tad more enjoyable.

This is one of those types of articles where I can wonder pretty easily with a number of tangential issues and being an engineer, the problem is exacerbated.  But I'm going to be as brief as possible, so just call me if you'd like to discuss these issues further.

STREET EXPOSURE / LOCATION.  Do you need street exposure or not?  If you are a destination (i.e.; people seek out your products or services) it's not so important, but if you are in a competive industry or trade, it may be critical.  However!!!  Retail customers are a finicky group and given almost any impediment to one shop, they will move on to a competitor -> retailers must absolutely make sure their location is conducive to their business.  A coffee shop without much parking or on the "going home" side of the street, or tucked away behind other shops might not be a great idea, regardless of lower rents as many buyers make instantaneous decisions to buy or not.  A corner with great street exposure but only "right-in / right-out" access is also problematic.  Discuss your business plan with your real estate advisor so they thoroughly know how important these items ae to your business and don't be surprised if your Broker, based on their experience with companies in your focus area, gives you some suggestions on important location issues.

ACCESS TO CLIENTS / CUSTOMERS.  We recently showed a regional real estate manager around the Treasure Valley as his company was looking to open a new type of service center for their clients.  He was armed with the locations of his clients and told us where to find him a suitable shop.  We sent him a list of properties which met his criteria.  When he got to town, we queried him further on his location criteria & it became apparent that with him being from a very large population area, his frame of reference was different than ours vis-a-vis travel time.  Once he understood our commute times from anywhere in the valley was less than he was used to, we were able to find him a suitable location at 1/2 the rent he would have encountered had he stuck to his original siting criteria.  However, in some businesses, access to clients is more important.  We recently placed an emergency response company and their highest priority was quick access to the interstate.  When we investigated average travel times, we were able to look in areas originally not identified as acceptable and saved 25% of their Base Rent with an alternate, acceptable location.

USE-DRIVEN NEEDS.  Okay, doesn't seem like it needs a lot of discussion, but you'd be surprised.  We had a meeting just a couple of weeks ago with a company that got a "great" deal (i.e.; the rent was really very low) on a warehouse a few months earlier , the problem was that it didn't have 3 phase power and the cost of them either modifying their equipment or bringing in 3 phase power was very high.  We've also dealt with firms who have service trucks who hadn't identified the truck clearance needed to get the truck in the shop.  There are some very fundamental items we commercial real estate agents generally go over with our clients, but make sure you have thought through any specialized needs your company has.  We had one client recently who specified a certain size water main to the property to ensure adequate water was on-site.  When we couldn't find that, given other constraints, we found that a smaller size main would deliver enough water for their given purpose.  Another issue is racking / stacking height (especially in a warehouse environment).  Fire Marshalls have certain constraints on the height of stacking and the use of racks.  We met a client recently at a warehouse they were about to lease & the client was meeting with a vendor to order storage racks.  Thankfully, we were present and we engaged the supplier in a discussion of his knowledge about fire suppression restrictions relative to local requirements.  When we identified critical issues, the client and the supplier were able to discuss those issues with the local regulatory authority.  Keep in mind that some "high stacking" may require a total redesign / replacement of whatever fire suppression system exists - at a significant cost.

HVAC ISSUES.  Make sure if you have special equipment or cooling / heating needs they are identified early in the process.  Tanning salons require more BTUs for cooling than a normal office or retail environment.  Consider whether your application will require more heating / cooling than the space can accommodate.  If it does, then your Broker will need to negotiate that item for you.

POWER NEEDS.  Most retail shops and small industrial shops will come with 200 amps, depending on the age of the unit and the size.  However, don't assume anything about what is available to the unit you are reviewing.  We were performing a review for a client of ours who needs 300 amps and a quick look at the electrical panel indicated the panel was rated at about that.  We called an electrician and upon investigation (the electrician removed the panel cover) he found there was a much lower supply actually to the unit.  Apparently, the contractor had used a left over panel out of convenience and had we not verified the actual amperage available, the tenant & landlord may have had a significant issue to resolve.


Okay, so hopefully I didn't wander too far off the beaten path.  The one point we want you to walk away with when searching for a new location, is to identify your business needs & technical needs in your chosen space - to the extent possible.  Identify to your Broker, those items which are critical and which ones are desirable.  Make sure, if you are in an existing location, your Broker tours your current location with you & discuss those things you like & dislike about that location.  Your Commercial Real Estate Broker is your advocate and consultant, make sure you identify those things you know which impact your business and then engage your Broker into their thoughts and ideas on other items / issues you may not have thought about.

We wish you all a great holiday season.  If you need assistance evaluating your commercial real estate needs, please feel free to contact us.


Scott Nicholson
Boise Valley Commercial Real Estate, LLC
208 890 3939
[email protected]



Posted by Scott Nicholson at 12/1/2008 10:42:00 PM
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Comments (1)
Re:The Leasing Process - Part 2 - Functionality
Great points Scott. It is the simple things that trip people up.
Trey Langford
Posted by on 12/1/2008 9:09 PM
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