Encountering a bait and switch with executive suites is a huge problem in the NYC commercial real estate industry.
Searching for the perfect sublet office space is no simple task. It’s stressful and can be incredibly draining especially if you are a practicing attorney. Shared office space in NYC is something that is designed to be more stable and a resource to any attorney looking to rent within the space.
Small firms and solos often use these spaces and the trend is increasing. This is certainly something that should not be ignored.
The executive suite concept works rather simply: the operator takes on a large commercial lease. The space may already be abundant with individual offices or there may be a need to renovate and create the individual offices. Furnishings and office equipment play a huge factor into making the space an area where people can conduct business. Staff is hired to manage the space and provide service to clients. Once everything is in order, the individual offices are rented out for a profit.
For solos and small firms this option is ideal. You get your own space AND the site is professionally managed by a team of staffers. Additional perks may often be very little extra cost.
The bait and switch…LOOK OUT!
It is a typical practice to have services built in to your rental agreement when using an executive suite. This includes guest reception, mail and package services, and much more. NYC executive suite pricing tends to be somewhat higher than a standard sublet office that may not have adequate services and is not professionally managed to meet the client’s needs.
It’s a competition out there for many providers which means shady tactics may pop up. “Too good to be true” deals pop up that ultimately hurt the consumer.
Take an office that is over-priced to begin with, say $3,000/month. Then give away four months’ free rent. Pro rate the free rent over the course of the year, and what was originally a ridiculous monthly spend now magically fits within your $2,000/month budget.
Short-term generosity is quite a pickle for customers because they get enticed by the niceness not realizing it’s not going to be there later. You might get that generosity for a year or two at best, but when it comes time to renew, you get bamboozled because only the profit is kept in mind.
Come year three, expect your renewal to be based on the base rental price (before the discount), plus an additional 10% – 20% increase.
Executive centers understand the stresses associated with a move. It’s not fun and overall is time-consuming and expensive. Such centers that pull this kind of crap know there’s a high probability the subletter is willing to pay the higher rent at least for another year because the stress of moving is often not worth it to many people.