Any business owner will tell you that finding the right workspace is essential in the success of a company. From the location to the fit out, each and every aspect of your office affects the productivity, functionality and efficiency of your employees and business. Hence why finding the right workplace is so important.
But when you finally do find the perfect office space, you’ll be saddled with another predicament – should you buy or rent?
Well, it may surprise you, but there’s never been a better time to rent commercial properties in Dubai and the UAE. Due to an oversupply in the commercial property sector of the real estate market combined with COVID-19’s negative impact on the economy, commercial landlords are now offering more flexible rent schedules in an attempt to retain tenants and a steady income.
This means that instead of the tight, rigid single block leasehold payments commonly found in the commercial real estate sector, an easy-pay rent schedule will be adopted to benefit both tenant and landlord. One-time annual rent cheques are expected to be done away with in favour of 12 equal rental instalments.
In light of this surprising yet welcomed news, we take a look at why renting might be the better option for your business:
1. Low financial commitment
Leasing an office space does not require a down-payment – only a refundable deposit. This means it’s much cheaper to rent a workspace than buy it, and will ultimately leave you with more working capital to grow your business in other ways.
2. Access to prime property
The better the property, the more money it will cost. And as such, it’s nearly impossible for small business owners or start-ups to afford to buy a commercial property in a more high-end area. This is especially problematic in a place like Dubai where a prestigious address and illustrious image is necessary for most businesses.
Renting a property allows you to access high-end properties in popular, well-frequented areas that would have otherwise unattainable with the capital of a small or new business.
3. Limited responsibility
When renting a commercial property, you get full access to the office space without the obligation of being responsible for repairs and maintenance of the building. As a tenant, the most responsibility you should have is to keep the place clean and unharmed, while the landlord takes ownership of any other expenses.
Keeping the above in mind, be sure that your lease contract clearly specifies who is responsible for what before signing the agreement.
4. Favourable tax deductions
One of the more appealing aspects of renting an office space instead of buying is the tax breaks. When you lease a commercial property, the monthly rent payments and ongoing costs, like utilities, are tax-deductible as business expenses.
5. More flexibility
Buying a commercial property means that you’ll have a mortgage that ties you down to one place. This is not ideal in the world of business, as situations change fast and you might find yourself needing to move location or find a bigger office space – which is difficult when you own the building.
By renting, however, you have much more flexibility and it’s much easier to move from one property to the next. All businesses grow as they get more and more clients and employees, which will need to be accommodated with a bigger workplace. Don’t hold your company back by buying when you can rent.
When choosing a commercial property to lease, don’t forget that the fit out is just as important as the location and building itself. And with the extra capital you have from choosing to rent instead of buy, we suggest investing it in a functional and stylish fit out that will impress your clients and inspire productivity and well-being in your employees.
If you are thinking about upgrading your commercial fit out with the extra cashflow you now possess, Contractors.Direct can help you in your endeavours. We specialise in connecting thoroughly-vetted, quality contractors with those who need their services. When you use us as your fit out partner, you will be provided with a Project Manager who will ensure that your project is delivered on time and on budget. Get in touch with us here.