Berlin still has a significant proportion of its buildings unoccupied. So why is it such a bitch to get office space here? Rising rents and increasing gentrification mean that finding the ideal location can be one of the toughest challenges facing a growing business in Berlin.
Antje Helmer from Berlin estate agents DTZ explains: “Startups are not sure how they will develop in the next two years. They often want flexible leases while the landlords want to have long contracts (3-5 years). Also many have no balance sheet that they can give to the landlord. Sometimes they have to pay a higher deposit, but that can also prove too much for them.”
But don’t go crying into your Macchiato just yet – that dream loft can still be yours. Read on for our top tips for securing the perfect office space for your Berlin startup…
Become a detective
Jasper Masemann of Great Content found himself searching for the perfect Berlin space for his growing company. He explains: “You might have found a nice apartment through immoscout.de or immonet.de, but don’t expect to find an office just by signing up to alerts. They may have some space but not many office landlords advertise there.
“In fact, you might often find a great office by pounding the pavements, becoming a detective and using your powers of observation. It’s best to decide on a specific area and then take the time to look for estate agent signs in the neighbourhood.”
Yes, that is a really cool loft and according to your finance plan you could afford it in six months. Hang fire on signing that three-year contract. So long as you are still waiting for that lucrative funding to fall, or even if you’ve just jumped over the golden break-even line be careful!
Jasper explains: “Fixed costs can kill your business if you still need a couple of months of bootstrapping. If you are small, start in a coworking space, which, in itself, can be a great way to network and build up the right contacts. If you grow, find a space with a flexible or three-month cancellation period contract. If you are rich, well, have fun!”
Don’t be too much of a startup
Startups can fail and landlords know that. At a Spätschicht it’s cool to be one but landlords are looking for solvent clients. So play your cards close to your chest – look presentable, be assertive and say more about the future than the past. If you are a brand-new firm, ask your investors if you can tell the landlord about current and future funding.
Berlin is the capital of Germany. So yes, most ads are in German. But even if you can read them you MUST have a German native speaker at your side when it comes to negotiations. Contracts are difficult, site agreements might become important and there are always hidden costs to watch out for. German is a complicated language, especially when it comes to business talk. Don’t risk getting confused and ending up with a bad contract!
Use your network
If you’re a founder, you’re probably already a well-connected individual. Use your existing network to put the feelers out. Post on Facebook, LinkedIn, Xing, Twitter. You’ll be surprised at how many people will push the repost button.
And mention your search at networking events – you’ll be amazed by how many people know someone who knows someone who knows someone just about to move out of a sweet office…
GetYourGuide.com is a Berlin startup that has seen its staff burgeon rapidly in the past 18 months. Co-founder Tao Tao explains why they used an estate agent to find their new premises on Erich-Weinert-Strasse: “The good news is that most of the time you don’t have to pay a commission to the real estate agent for office space.
“For startups, only the real-estate owner pays a commission, which means no costly three-month rent. Estate agents will also have an entire inventory of the larger free spaces in Berlin and will help you filter down according to criteria (including what “style” is best for your company).”
They also know that startups “grow” and can lead to repeat business, so a good estate agent won’t push too hard to close the deal and will offer tips on negotiation. Make sure you shop around for an agent that understands your company ethos and needs.
Just like anything else in business, persistence mixed with creativity pays off when hunting for your perfect space. Don’t just sign up to property sites and sit back. Check often and follow any potential leads aggressively. If you have an intern, make”Project Office Space” their priority and offer a cash reward if they find you the right spot.
Or let them flex their creative muscles by flyering buildings or neighbourhoods that you’d like to work in, or even starting a blog that chronicles your search, like this pair.