Guides
Why an office of the same size can hold very different headcounts
Office space sized from how a team actually works, why identical areas hold different headcounts, and how to compare buildings on cost per usable seat.
Offices are priced by the square foot, occupied by the seat, and lived in by the hour. Those three units disagree with each other, and most of the money lost on a workplace decision is lost in the gaps between them.
This page is about the specification: how much space you need, what kind of building can deliver it, how you want to hold it, and for how long. Get those four settled and a negotiation becomes a comparison. Skip them and you will negotiate hard over a building that was never right.
What to take away
- Two floors with identical stated areas can seat very different numbers of people. Efficiency is a property of shape, not of size.
- Term length is a bet on your own headcount. Buy flexibility deliberately, and know what it costs.
- The building's systems and hours decide whether the space works. The floor plan only decides how it looks.
Start from how the team actually works
The useful question is not how many people you have. It is how many of them are in the building at the same time, doing what.
Work through it in this order:
- Count the peak, not the payroll. If attendance varies by day, the busiest recurring day is your design load. Sizing to the headcount produces empty space every day of the year; sizing to the average produces a scramble every Tuesday.
- Separate the work types. Focused individual work, collaborative work, calls, and meetings need different rooms in different proportions. A team that lives on video calls needs far more small enclosed rooms than a team that does not, and small rooms are the thing most often undersupplied.
- Count the things that are not desks. Storage, a lab or a workshop, equipment, deliveries, samples, a place to eat, a place to leave a coat and a bike.
- Write down the growth range rather than a growth number. The bottom of the range tells you what you must not overcommit to. The top tells you what flexibility you need to buy.
- Decide what you would give up. If everything on your list is essential, you have no shortlist, and you will end up paying for the last item on it.
Why identical areas hold different numbers of people
Two suites can carry the same stated area and seat a materially different number of people, because usable capacity is decided by shape.
What decides usable capacity
- Depth to the window
- Where the core sits
- Column spacing
- Ceiling height and above
- Existing partitions
Why identical areas differ
- Depth to the window.Space far from daylight is fine for storage, meeting rooms and equipment, and unpopular for desks. A deep floor plate with a small window line has a lot of it.
- The core.Lifts, stairs, risers and restrooms sit somewhere. Where they sit determines whether the remaining space is one workable area or a set of leftovers.
- Columns and structure.Column spacing decides whether a room layout works or whether every plan has an obstruction in the middle of something.
- Ceiling height and the space above it.Height affects how the space feels and whether you can change the layout, run new services, or fit anything tall.
- Existing partitions.Inherited rooms in the wrong places are a cost, not a saving, and removing them is rarely as simple as it looks.
Walk a shortlisted floor with a plan and mark where you would actually put people. It takes twenty minutes and it is the most informative thing you can do on a viewing.
Four ways to hold the space
The tenure decision is separate from the building decision, and it is the one that decides how trapped you are when the plan changes.
Four ways to hold space
Direct lease
- What you get
- Own space, own terms
- What it costs
- Long commitment, fit-out capital
- Flexibility
- Low
Sublease
- What you get
- Usually fitted out
- What it costs
- Their terms, their solvency
- Flexibility
- Medium
Assignment
- What you get
- The lease itself
- What it costs
- Whole obligation, past problems
- Flexibility
- Low
Serviced suite
- What you get
- Everything included
- What it costs
- Higher cost per seat
- Flexibility
- High
What you get
- Direct lease
- Your own space on your own terms, and the ability to build it out
- Sublease from an existing tenant
- Space that is usually already fitted out, often for a shorter remaining term
- Assignment of an existing lease
- The lease itself, transferred to you
- Serviced suite, managed office or coworking membership
- Space with everything included and a short notice period
What it costs you
- Direct lease
- Length of commitment, capital for fit-out, and the obligations that come with a lease
- Sublease from an existing tenant
- You inherit their lease terms, you depend on them staying solvent, and the landlord's consent controls the deal
- Assignment of an existing lease
- You take the whole obligation, including anything already gone wrong
- Serviced suite, managed office or coworking membership
- A higher effective cost per seat, less control, and terms that can change on renewal
There is no correct answer. A business with an unpredictable next eighteen months and no capital should not be signing a long lease to save on the per-seat rate.
A settled business paying a monthly premium for flexibility it never uses is buying insurance against an event that already passed.
Term length is a bet, so price the hedges
A longer term normally buys a better rate and a larger contribution to fit-out. It also fixes your costs against a future you cannot see.
Flexibility instruments to negotiate
- Break option, with conditions checked
- Expansion rights over adjoining space
- Sublease and assignment rights
- Shorter term with renewal option
The instruments that buy flexibility all have a price, and the price is negotiable:
- A break option.The right to end the lease early on notice. Check what conditions attach, because a break that requires the space to be in a particular state, or all sums paid, can be lost on a technicality.
- Expansion rights.A right of first refusal or an option over adjoining space. Worth more in a building with several small suites than in one where the only other space is enormous.
- Sublease and assignment rights.Your exit route if the plan changes. The consent standard is the part that matters.
- A shorter term with a renewal option.Often cheaper than a break clause, because you are asking for less.
Decide which of these you would actually use before you trade rate for term. Flexibility you will never exercise is the easiest thing in the negotiation to give back.
The systems decide whether the space works
The floor plan gets the attention. The building services determine whether anyone can work there.
Building systems to verify
- Heating and cooling hours
- Zoning and sensor locations
- Power capacity and spare
- Fiber providers and redundancy
- Lift count and peak waiting
- Access hours and security
- Restrooms and end-of-trip facilities
- Heating and cooling hours.Many buildings run systems on a schedule. If your team works outside it, establish what after-hours conditioning costs and how it is requested. This surprises people every summer.
- Zoning.One thermostat for a whole floor means one comfortable group and one unhappy one. Ask how many zones you have and where the sensors are.
- Power.Establish the capacity available to your suite and whether there is spare. Equipment-heavy teams outgrow the supply, and upgrading it is a landlord conversation with a long lead time.
- Connectivity.Ask which providers already have fiber into the building and what installing a new one would involve. A building with one incumbent carrier is a building with one price and no redundancy.
- Lifts.Count them, then watch them at the start of the working day. Waiting time at the peak is a real cost in a tall building.
- Access hours and security.Whether the building is open when you work, how visitors are handled, and what happens at weekends.
- Restrooms and end-of-trip facilities.Capacity per floor, and whether there are showers if your team cycles.
Each of these is cheap to ask about before you sign and expensive to discover afterwards.
Accessibility belongs in the specification
Getting into the building, moving through it, and using its facilities are obligations rather than preferences, and they attach to the space you occupy as well as to the base building. The route from the street, the entrance, the lift, the restrooms, the door widths and the signage all matter.
The federal accessibility standards and design guidance are published by the United States Access Board. The requirements for a building and an alteration depend on the property, the work, and local codes.
Ask the landlord what has been assessed and when, and get anything you are told confirmed in writing before it becomes your problem to remedy.
The cost you pay is not the cost you were quoted
Whatever the rent structure, the building's own performance shows up in what you pay to run it and in what you can be charged for.
Ask for the property's actual operating expense history rather than a projection, and ask what is excluded from the history you are given. Ask about the age and condition of the plant, because a system near the end of its life produces both discomfort and expenditure. Ask how the building is metered, and whether your consumption is measured or apportioned.
For benchmarking energy performance and understanding what a building's running costs are made of, the Energy Star buildings program publishes the measurement approach used across commercial property in the United States. A building that has been benchmarked will usually tell you so, and a building that has not is not necessarily worse, but nobody can tell you either way.
Compare buildings on cost per usable seat
Rate per square foot is the wrong basis for comparison, because the space it describes is not the space you use.
Cost per usable seat
- Total annual cost of occupying
- Include rent, charges, utilities, cleaning
- Add insurance, parking, fit-out amortized
- Divide by people you can genuinely seat
- Use the layout marked on the plan
For each shortlisted option, work out the total annual cost of occupying it, including rent, the additional charges, utilities, cleaning, insurance, parking, and the amortized cost of the fit-out you would have to do. Then divide by the number of people you could genuinely seat there, using the layout you marked up on the plan.
That single figure will reorder your shortlist, and it usually promotes the building that seemed slightly expensive and demotes the one that seemed cheap and awkward.
Common questions
How much space do we need per person?
There is no number that survives contact with a specific team, a specific floor plate and a specific way of working. Density rules of thumb are averages taken across businesses that look nothing like yours. Work from your peak attendance, your mix of work types, and a marked-up plan of the actual floor.
Is a sublease a good deal?
It can be, particularly if it is fitted out and the remaining term matches your uncertainty. The things to check are what the underlying lease says, what happens if the tenant you are paying fails, whether the landlord's consent has actually been given, and what your position is at expiry, which is usually nothing.
Should we take extra space now for growth?
Only if you can pay for it while it is empty, or the lease lets you sublease it. Otherwise buy an option over adjacent space instead, which costs far less than carrying rent on rooms nobody sits in.
When does a serviced or managed office stop making sense?
At the point where the per-seat premium over a comparable direct lease exceeds what the flexibility is worth to you, and you can predict your headcount well enough to commit. That crossover arrives sooner than most growing teams expect, and later than most landlords suggest.
In this guide
- Office space checklist: every item, with the reason behind itAn office space checklist in eight gates, from the requirement you write before looking to the verification, the legal review and taking possession.
- Office Space Examples: Avoid Missing a Renewal NoticeOffice space examples for tenants managing renewal options: identify the notice window, assign a primary and backup, verify delivery rules, and preserve proof.
- Office space mistakes worth avoiding earlyNine office space mistakes to avoid, including verifying permitted use, comparing total occupancy costs, and negotiating lease exit terms before signing.
- An office space search splits into four jobs: here is who does each oneOffice space services sorted into four jobs, how each adviser is paid, a scorecard for their answers, and a trial task to run before you appoint anyone.
- How to compare two office offers without being fooled by a good tourAn office space comparison method: normalize the two offers first, score the kill criteria before the preferences, and run a working day in each building.
