How Much Space is Enough?

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If you’ve been through the move process you’ve undoubtedly asked this question and have looked at a few of these:

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As an entrepreneur, and depending on your company, right-sizing your space will be an ongoing challenge. There are some general metrics used by brokers and larger companies that can be a helpful guideline. A common one is usable square feet per employee. The usable square feet vs. rentable square feet topic is a lengthy discussion and worthy of a separate entry.

Guy Kawasaki published a great article on Redfin detailing their startup costs and budget including their office space estimates:

Redfin Model: $250. Actual Redfin Cost (Last Month): $336

Our actual costs are high because we just moved last month into an office with room to grow, which seems to happen every eighteen months. When people were sitting in hallways at the old space, we were paying about $200 per employee, per month. Class B space on well-traveled mass transit lines is roughly $20 per square foot per year in Seattle, $30 in the Bay Area. You need 165-200 square feet per person or more.

At the extremes, Adobe supposedly allocates 435 square feet per person while Yahoo! allocates 220 square feet per person. The startup cult of cramming people into small spaces is counter-productive: people are what’s really expensive, not space. web archive The cost Redfin really didn’t anticipate was for tenant improvements which you mostly have to fund yourself when signing sub-three-year leases. In September, we spent more than $100,000 to add private offices for our engineers on the hope that our current office will last us longer. It was probably too much money.

If you’ve come across any other stats or tricks for planning your current and on-going space needs please let me know. Our Q&A section at www.rofo.com is always a good place to check for other ideas and resources.

Written by The Rofo Team

July 11th, 2008 at 11:18 am

Posted in General

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