Once you’ve decided what your company’s needs are and where you want your office to be using Part I of our how-to guide, you’re ready to find your dream office and seal the deal.
1. Find a listing
Locating resources in a new city can be hard. Here are several channels you can use to find your office in Beijing:
“Agents are a legal security when you sign your office with a landlord,” says Jean-Baptiste Audran, co-founder of Scout Real Estate, a Beijing company that helps expats find homes, offices and retail space in Beijing. The advantage of having an agent is the peace of mind you get with legal issues; they’ll also help you analyze your decision, says Audran. “You better know what you’re doing if you sign directly with a private landlord”.
There are three types of agents: big international companies like Savills, local agents, and foreigner-managed agencies.
Big international companies usually only deal with big companies, so they may not be suitable for startups and small and medium sized companies (SMCs).
Local agents tend to not know as much about foreign customers and the foreign lifestyle, says Audran. “When we talk about Google offices, when we talk about coworking space, it’s not a concept that most of them understand clearly.”
Beijing technology startup Origins founder Liam Bates used about a hundred local agents to help him find the company’s courtyard space.
“We actually had an intern whose job for about a month was just to find an office. She basically rode a bike all around Beijing, we mapped out exactly on this map where we wanted to be…and she went to every single real estate agent and said: this is what I’m looking for….If you want a place like this, you need a hundred people looking for you,” says Bates.
With a local agency managed by foreigners, you get local knowledge combined with foreign expertise, says Audran.
Chamber of Commerce
Many countries have Chamber of Commerce branches in Beijing. Some of them, such as the German and French Chambers, will rent several floors of an office tower and rent them to business owners for reduced prices. “A Chamber of Commerce is also a nice first contact for you to know what’s available on the market,” says Audran.
There are many websites like Ganji.com, Fang.com, Diandianzu.com, Office Hui and the Beijinger where you can find listings for office space, but in Bates’ experience, listings are usually posted by agents anyway.
“An agent will look for you, or you can spend three hours looking on a website and call and it’ll be an agent anyway, so you may as well make them do the work,” says Bates.
Furthermore, websites won’t give you legal help, and may not contain updated information, says Audran.
For Arturo Velez, the first employee to come to Beijing from Naranya, a software development company, leveraging his network of contacts was the best way to find an office space. He found coworking space DayDayUp through a networking event in Beijing which he attended a few months before he moved to the city. “Wechat is a good source of information. [There are] groups of foreigners, groups of people in business.”
2. Seal the deal
Once you’ve found a suitable place, it’s best to seal the deal, and fast, says Bates.
But before you sign, check the landlord’s property title to make sure he actually owns the property. One thing to look for is the designated use of the building on the property title, says Audran. It will say residential or commercial space, “and basically you want it to be commercial, not residential,” says Audran.
Real estate prices go up very quickly in Beijing, says Audran, so try to sign long-term. “Try to find long-term offices for five years or even more, if you can.” You can also put in a renewal clause that prevents the landlord from raising the price above a certain percentage if you renew the contract.
Bates had an interesting experience with a local agent. “The real estate agent told the landlord that we would pay more than the asking price, and he told us that the landlord would accept less than the asking price. Very Chinese, also very smart in a strange way,” says Bates. When they met to settle the deal, the agent walked off and left Bates and his partners to negotiate with the landlord on their own.
- Take care of the details
Even after you lock in your dream office, there are a lot of other things that can still go wrong. Things that may never have occurred to you, like phone lines and internet, could prove disastrous for a company. According to Audran, some company phone lines are non-transferable even within Beijing, and this could be a big problem for some companies. Phone lines, internet speed, whether the air conditioning runs 24 hours in the building, parking fees, “these are the biggest things that people forget,” says Audran.
His advice for companies who need to renovate is to leave enough time to find the right renovation company and the right furniture company, and negotiate their bids. In China, you have to file an application with the fire department for every change you want to make in your renovations, which will take a great deal of time. Also, don’t be afraid to put a clause in your contract with your renovation company that they will receive a certain percentage of their payment after a year to ensure they come back if there are any problems, says Audran. You can also ask them to take responsibility for the renovation deposit, “because they are the ones who potentially will break anything,” he says.
- Avoid common mistakes
China is a very bureaucratic country. There are many procedures that you need to acquaint yourself with. “Think in advance what your company is going to do and what size you’re going to be,” says Bates. If you’re working in certain industries or your company makes over 800,000 RMB in revenue, you have to acquire yibanlasuiren taxpayer status, which comes with certain requirements for your office space, such as a finance room with a safe. “I’ve known people who’ve gotten a small office somewhere because that’s all they need, and they work out that they can’t get their taxpayer status because they find out it’s not an individual office room, it’s just a desk, and that doesn’t cut it,” says Bates.
Another common mistake is that companies don’t leave themselves enough space to grow, says Audran. Can you expand within the building you’re renting, or will you have to move? “Try to anticipate the speed of your growth,” says Audran. Velez chose a coworking space because, although he is the only employee at Naranya’s Beijing branch at the moment, they plan to grow quickly and coworking spaces tend to be more flexible. “This space also allows us to grow as a company, [and acquire] team members step by step,” says Velez.
Now that you have all the information, you’ll be able to smoothly navigate the process of finding an office in Beijing and avoid the common pitfalls. If you found this article helpful and would like to see more articles like this on our site, please let us know in the comments below.