Leasing versus Buying Office Space

How Leasing Office Space can Save You Money

Leasing versus Buying Office Space  The time has come to start scouting out office space for your start-up and making an important investment in the future of your business. It is common for new entrepreneurs to plan on buying their first office space because there are several benefits to owning your own office. Some of the more significant benefits are:

  • You can remodel it to look any way you want.
  • You can benefit from the equity that builds up in the building over time.
  • When the building is paid off, you can sell it and use those proceeds to buy a larger office.

As convenient as owning an office space can be, more and more entrepreneurs are leasing their offices and steering clear of ownership. When compared to owning an office space, many start-ups are seeing distinct advantages to leasing a space and paying a monthly rental fee.


When you own an office space, you are responsible for the maintenance to the building. When the roof leaks, you have to call a roofer and pay to have it repaired. When you lease an office space, a leaky roof is fixed with a call to the building's owner. You do not incur any extra expenses involved with maintenance.

The same can be said for remodeling and upgrading the building as well. If the local building inspector determines that your leased office space requires modifications to meet the new local building codes, then that financial responsibility falls on the building owner. Building maintenance can cost thousands of dollars per year and it is a cost that those who lease do not have to worry about.


When you mow the lawn or trim the hedges at home, you never really give it a second thought. But if you own an office building, then you will have to pay someone to take care of your landscaping. You always want your office space to look its best and that is why landscaping is an important investment. When you lease the building, you do not have to worry about the costs of landscaping.

In some parts of the country, landscaping becomes a very important part of owning and running an office building. In the areas where it snows, it is critically important to keep walkways clear of ice to prevent falls and lawsuits. When you lease the office space, you do not have to worry about any of that.


It is significantly easier to negotiate a deal on leasing an office space than it is to buy one. The upfront costs for buying an office space far exceed the upfront costs for leasing, and that doesn't count the possibility that the space you are buying may need minor, or major, repairs before you can start using it.

When you lease an office space, you choose the space you like and then negotiate a lease with the building owner. You tell the owner when you would like to move in and it is up to the owner to make any modifications that need to be made before you take residency.


So you bought a great office building for your company on Main Street and got a great deal on it too. At the time you bought the building, Main Street was the ideal place to put a retail business because it offered great exposure and plenty of foot traffic to keep your business going.

Five years after you signed the purchase agreement on your building, the business district in your town moved from Main Street to State Street. The problem for you, aside from the fact that you are locked into Main Street for the duration of your commercial mortgage, but State Street is all the way across town. Even if you wanted to sell your building and move your business to State Street, it would be almost impossible to find a buyer.

If you had leased that office and retail space on Main Street, then you could have just moved your business to a new location on State Street and followed your customers. When you lease your office space, you have much more flexibility than if you own the building.

Instead of taking a chance and purchasing the office space for your new start-up, you will want to give some serious thought to leasing instead. As far as a good financial decision, leasing offers a lot of benefits that buying could never offer, and leasing could be the right long-term solution for your business.