Even though many of us have shifted to almost an entirely remote operation during this current health crisis, we continue to have obligations in terms of operational expenses tied to commercial leases.  It’s frustrating to know that although we are not physically in our offices that we are still responsible and owe expenses on them.  Below are some thoughts and advice on how to hopefully cut back on some of those necessary operational expenses while we all continue to work from home.

Negotiate with Your Landlord

First off, we recommend that you work closely with your landlord on any options for the understanding of your lease; all leases are a bit different.  Sometimes, all it takes is an open dialogue and honest communication between two parties and an understanding of what is possible- or not possible.  Many commercial leases include language regarding rent suspension in times of crisis or “Act of God” situations.  Understand the grace period for payment due date on your lease, and if possible work closely with your landlord on a payment plan if some form of rent must be paid monthly.

Evaluate Rental Insurance Policy

Contact your insurance agency and reevaluate your current policy and if you need to adjust or freeze the policy, while the office is vacant.  You want to ensure you still have sufficient coverage and protection for any necessary equipment, materials, or furniture that remains in your office during this time.

Freeze Your Utilities

Other savings may be made in your monthly services or utilities.  In many commercial leases your utilities which can include gas/heat/electric/water and sewage may be billed through the base building or you may have separate accounts.  If you are able to contact the utility companies directly to freeze or suspend these services while your office is vacant, do so.  The good news is, that if no one is utilizing these utilities you should have little to no usage on your monthly bills.  If your utilities are billed back through the base building, and the utilities are managed and controlled at a building level, we again recommend working with the landlord on these charges and if there is a possibility to freeze. 

Understanding how the building bills back operational expenses for your leased spaced and also common corridor utility usage is important.  Some of these expenses are billed annually in advance and then possibly refunded if the base building usage and your percentage is down year over year- this may happen for many leases this year.  Depending on the lease and landlord this can be done monthly, quarterly or annually.

In terms of utilities/services like phone/internet/cable, you should contact your provider directly and freeze your service during this time. Having your Director of IT make the decision on what is needed to keep the organization active from a remote standpoint is important- include this individual in any decisions regarding internet or cable services that may affect your server or cloud-base service and output. 

Cut Services

Other recurring monthly services that can be suspended or froze might include: cleaning services outside of the scope of basic building suite cleaning, interior/exterior landscape and florists, security (where possible, and if able to), parking, recurring scheduled office supplies or pantry items and water coolers, etc.

Looking Forward

Although this may not be a current option, potentially something to look to in future months when people return to their offices, you can consider subleasing unused space.  Many organizations have had to drastically cut their staff either with furloughs or lay-offs and are now left with more space than needed.  Examine the sublease portion of your lease, and work with the landlord on potential subleases for space no longer needed for the immediate future.