Ask HN: Help, we need (real) NYC office space.

[joshklein]

We've grown from our apartments, to working within consulting client offices, to a small WeWork office (executive suites), to the open loft in Projective SoHo (co-working). All of these options have the same major drawback: distractions.

At home, the distraction is being separated from each other. In other spaces, the distraction is another company's non-hackers doing whatever it is they do (loudly). The recent HN link to "open floor plans must die" is spot on.

We'd love to follow Joel's old advice (http://www.joelonsoftware.com/articles/OfficeNewYork.html), but we don't have the time to find and build out an office from its skeleton. We're hacking towards deadlines.

After conversations with brokers and small biz owners, it's obvious the commercial real estate game is just as broken, if not more, than the residential one. I think in an ideal world, we'd just rent a residential loft and hope no one minded half a dozen folks hacking there instead of sleeping.

Have you gone through this? Do you have any ideas or leads?

[epc]

Do you need to be in Manhattan? There's some smaller offices still available in DUMBO (but going quickly). Downtown Brooklyn has a lot of vacant Class B type space. Slightly off the beaten track is some just renovated space on Front Street in Vinegar Hill (a couple of blocks north on Front Street from DUMBO proper). 231 Front I think, mix of pure rentals and co-working spaces.

If you want to stay in Manhattan (or must), consider looking in the old garment district, W30s between 7th and 9th avenues. Still a lot of loft style space that you can carve up whatever way you want.

I haven't looked for office space recently, but if I had to I'd probably start first by finding a decent broker. NY real estate is still very old school "I know a guy" type of networking & negotiations.

Also consider asking for referrals to people/places on either the nytm list or nextny.

[cd34]

I see this mentioned a lot - what is broken in the commercial real estate game?

Looking at one of the REITs I own shares in, they claim a commercial vacancy rate of 14% which isn't going to give a lot of room for negotiation.

But if you're looking for a loft/open space, you can fill it with partitions that you can buy or rent. It isn't a perfect office, but, easy to construct with minimal delay in getting to the new space.

[epc → cd34]

What's broken is that many NYC commercial/office rentals won't offer a flat "this is how much we charge PSF", instead it's "well, who are you, what are you doing, and what's your budget?"

[cd34 → epc]

It's called qualifying your prospect. I suspect something you said or did suggested that you were going to be a lot of time for a minimal commission and they didn't want to be bothered with it. Short term and small leases are very uninteresting to brokers as their commission is based on the total lease value.

1) Who are you? Are you going to be around for the long haul, is it temporary, are you likely to be able to pay the bills or are you going to break the lease in six months when the desire arises. When you break the lease, are they going to be able to collect the termination fee, if not, that all gets factored into the price.

2) What are you doing? Is it a data center, are you going to have a lot of foot traffic, are you going to have people living there all the time writing code, requiring them to keep the environmental units on all the time, i.e. do you need to be in a 24x7 office building. In DC and Baltimore where I leased a lot of space over the years, many buildings didn't operate chillers on the weekends and a southern exposure with untinted windows made it unbearable. Even during the week, the A/C units struggled to keep our space cool, but, it was cheap - and now we knew why the law firm didn't have a problem giving up what we considered 'prime space'.

3) What's your budget - do you want scenic views of the Hudson or Central Park, or, are you willing to get space somewhere without a view. Real estate gets more expensive the closer you get to public transportation in NYC and a few other cities. Windows add to it. If you're looking for a space just to get people together on a daily basis and can turn a cave into a workspace, then you can find properties that have been carved out of companies that have downsized where they kept the window, but threw away the rest of the 'useless' space. However, if you want that window view from the 50th floor, it isn't going to be cheap. Most floorplans in cities try to make sure every office has access to the central core (elevator bank) and windows. Space without windows is typically storage. One of the spaces I rented in Baltimore was a 1440 sq ft chunk out of the back of a surveying firm. No windows, crazy hallway cut from their office that wound back to the space, but, again, space they were willing to get rid of and remove from their lease. I did sublease space in DC one time in a building and we brought our own construction crew in, created our own door in the hallway and took a chunk of their space.

Find a broker, tell them that you want x thousand square feet, you want a one year lease with two one year options, you don't need a buildout, you're willing to settle with property without a view and you're willing to do a quick close. Be careful with the lease terms and make sure they specify whether it is net or triple net so you're not surprised with the property tax being added to your rental with the first bill is due.

Every building is different, most have separate owners even if they share the same management company. Almost all properties count common space as shared among the lessees based on a percentage of the square footage you lease. Even different floors in the same building can have different prices. Make sure they tell you what the final price is, in writing, on your lease agreement before you take it to your attorney. Depending on whether they have a concierge or doorman, the level of security in the building, i.e. security guard, access control all contributes to your lease price.

Double check utility cost, high tech companies are sometimes asked to submeter, additional cooling requirements are often factored in. You can ask for a space with a shower, but, absolutely don't tell them people are going to be sleeping there. If they ask, many of the employees ride bikes/rollerblade/etc. Find out if you are required to use their cleaning service (or if it is included).