In real estate and brokerage, you will find these terms regularly. Multi-tenant office and single-tenant office. But what do these terms mean and what are the advantages and disadvantages of these type of offices?
Single-tenant office meaning
Renting a single-tenant office means that you rent the building, without sharing the space with one or more other companies.
If you choose to occupy an entire office with your company, the duration of the contract is important. Often you are fixed in the office for a minimum period of 5 years. You arrange the office and the facilities entirely according to your own wishes.
Multi-tenant office meaning
Renting a Multi-tenant office means that you are renting your own office space or office floor within a building with more tenants.
When you choose to occupy an office space in a Multi-tenant building with your company, the consumer is much more important. Often you rent the office for a shorter period against flexible rental conditions. In many cases it is a fixed all inclusive rent per month. You design your office space according to your own wishes (or rent it including office furniture) and use the general facilities in the building.
Multi-tenant offices are very popular
Renting office space in a multi-tenant office building is currently very popular on the Dutch office market. The need for office space has changed a lot in the last years. From renting an office building with one tenant to renting an office space in a multi-tenant office building, where the facilities of the office building are increasing in importance. This trend is partly due to the fact that more and more companies are implementing new office concepts, such as the new way of working, in their business models.
Nowadays, we prefer to work at flexible workplaces with working hours that we can determine ourselves. The only condition: a fast internet connection and good coffee. The offices as we used to know is becoming more of a meeting place instead of a workplace. Office concepts that offer flexibility and combine working and meeting are very popular in the Dutch office market.
Which type of office is more inexpensive?
Due to the changing office space needs in the Dutch office market, there is a clear dichotomy between outdated buildings in which substantial investments are often still required to meet the tenant's wishes and attractive office buildings that provide the tenant with all the conveniences he or she needs. But what is more advantageous?
In general, attractive office buildings with all modern conveniences have a higher rent compared to outdated office buildings. This is partly due to the investment costs that you, as a tenant, will have to incur for the building to meet your needs. On balance, therefore, there is little difference between the rents of obsolete office buildings in which investments still need to be made and attractive turnkey office buildings.
The big difference lies in the additional costs. The service charges consisting of, for example, small-scale maintenance, cleaning costs, costs for gas, water and electricity, internet and telephony of Multi-tenant office buildings are divided proportionally among all tenants. In a Single-Tenant building these costs are entirely at the tenant's expense. Besides that, in a Multi-tenant office building you can make temporary use of general meeting rooms, whether or not for a fee, and you do not have to rent these for the entire term. As a result, it can ultimately be even cheaper for you as a tenant to rent office space in a luxury multi-tenant office building. Therefore, in your search for office space, consider not only the rental price, but also all additional costs.