Own real estate business: sublease

Repair and construction business Real estate agency

For quite some time now, an absolutely unacceptable situation has been observed in the real estate market - there is a huge demand for rental mini-offices (from 50 to 200 square meters) and there is absolutely no normal civilized supply. If an offer appears, then such offices are leased at astronomical prices, far exceeding the cost of renting a large office.

Previously, officials, directors, and state farms leased out dusty areas of their dilapidated estates - which they had inherited from the Soviet regime. And they put this money in their pocket. The areas were rented at preferential prices to their people. A hen is pecking a grain ... But recently, these strong business executives have learned about what is happening with market prices. And they began to trade their smoky areas for the same astronomical money. Demand has fallen. Yes, and it became unfashionable among the officials, probably, they found more glamorous sources of extra earnings.

Another legacy of the Soviet regime was used by the seekers of small areas - the gray block walls of the former research institutes. Go to any floor. Stumbling over ragged linoleum, and having trained your eyes to see in the dark, you can count up to 25 companies that shine with gold, shy with their solidity and impressive signs, suggestive.

The remaining representatives of small (and medium) businesses are huddled in basements altogether ...

On the shortage of small office space you can make money in a civilized way, building a sublease business far from the above.

Immediately make a reservation that experts in the field of building a business, this type of business is considered only as an additional source of profit. However, they do not exclude the possibility of success even if such a business is your only and main business.

Officially, such an enterprise will be called a multifunctional office center. Similar companies already exist in Moscow and St. Petersburg, among them Regus, Daev-Plaza, Atrium ...

These newcomers to a civilized sublease do not rent square meters, as was always the case, but workplaces (or rooms). In terms of meters, they earn up to $ 1, 500 per square meter and consider this a good budget.

There are two ways to arrange your sublease business.

The first is when you rent a very large piece of space from a tenant who stays with you in the same room. This way has difficulties: firstly, the one who is in charge of the room must agree that you will split this piece and retake it to other people. Secondly, he will not want to see some people under his roof and therefore will intervene in every contract that you will conclude with prospective mini-tenants. But if the Big Master will be happy with everything, then this way has no more minuses.

The second way is to rent the entire building and stay there as a temporary owner yourself. People who lease the entire room to you are usually not interested in the details of your affairs - you bear all the risks.

However, in both cases, the line you conclude in the initial large lease agreement that you intend to cut this building into mini-offices and redistribute to subtenants.

You should not have any more problems, except for the most common and familiar ones, such as: underloading of empty space, late payment, damage to property. That is why experts consider this type of business risky and unsuitable in order to rely on it as the only source of income.

What is required of you to organize a business on sublease:

1. Rebuild the room so that it turns out to be divided into small offices.

2. This also implies repair using wear-resistant materials.

3. Equipment of two or three good meeting rooms.

4. Equipment for entering the business center, parking lots.

5. Installing an automatic access control system.

6. Carrying out optical fiber, telecommunications, the Internet and a modern telephone exchange with automatic call hold.

7. You must enter into an agreement with a security agency.

8. At the repair stage, design a place for the reception and look for employees who are adequate to your requirements.

9. Find a manager.

As the players of this market say, everything else - i.e. other, additional room requirements are always welcome, but sometimes they are completely redundant. Only the most necessary is listed above, without which it is impossible to live. But maybe it’s worth including in the list of your vital duties also a good corporate dining room with a kitchen that does not cause negative consequences? In order for employees not to run around for pies and ready-made salads, because the lack of infrastructure for a civilized lunch break for employees negatively affects the image of class B and C offices ... Not to mention how this negatively affects the health of employees themselves.

For 2000 meters of the area you rent, you will invest about 850 thousand dollars. Repair will take about three months. For repairs separately will need 400 thousand dollars.

Income from sublease will amount to 150 thousand dollars a month.

if you will repair the building for class A offices, then investments and profit will be higher. But if we are talking about class B and C, then it is significantly lower than the indicated figure, since the numbers are average. In the upper segment of the market, your profit will exceed the average 50%, but if you prefer to work with modest entrepreneurs who do not care about the image of the office, then the profit will not exceed 10-20 percent.

costs promise to pay off almost immediately - within a year.

Good luck to you!

Nazarenko Elena

(c) www.clogicsecure.com

* The article is more than 8 years old. May contain outdated data

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