The Branson metropolitan area has largely avoided the work-from-home trend that began during the COVID-19 pandemic.
As a result, demand for office space remains healthy in the region.
In fact, Commercial One Brokers' 2023 commercial real estate forecast shows that nearly all building classifications were close to full occupancy in 2022. Class A and Class B declined slightly but remained strong at 95% and 92% occupancy rates, respectively. Class C hit a very tough 99%.
Occupancy rates have remained at record levels throughout 2023 and are expected to remain at these levels through the end of the year.
Many businesses, especially small businesses and startups, find it more economical to rent office space than to purchase an entire commercial property. Renting gives you the flexibility to relocate as your business grows and your needs change over time.
Commercial One Brokers has the experience and deep local knowledge to help businesses of all sizes rent office space in the competitive Branson market. Here, we share our latest insights into the current office environment and tips for finding the right space.
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CRE and Office Space Trends Branson Office Space Market Tips for Renting Office Space Work with a Trusted CRE Professional
CRE and Office Space Trends
According to the National Association of REALTORS®, the commercial leasing market slowed overall in the second quarter of 2023. Analysts expect delinquency rates to rise in the second half of the year, primarily due to lingering cost pressures for many businesses. Many CRE sectors are experiencing slowing rent growth and rising vacancy rates.
With many employers adopting hybrid working arrangements in the wake of the pandemic, office vacancy rates reached a record high of 13.1% in the first half of 2023. Tenants in many markets are scaling back their square footage requirements per person as the industry adapts to changing work patterns and needs.
Branson's Office Space Market
Office leasing conditions remain tough in the Branson metro area, with Commercial One Brokers not expecting significant vacancy in the near term due to several factors that are limiting new construction.
High construction costs, tight labor market, limited material supplies
Class A
Branson-area Class A office buildings recorded a 95% occupancy rate in 2022, with more than 101,000 of the 107,000 rentable square feet occupied. New leases rose to $12-13 per square foot in 2023, while new vacancies rose to $13-14. Vacancies could increase further if landlords increase renewal rates and economic weakness continues.
Class B
Class B buildings were 92% occupied in 2022. Of the roughly 120,000 square feet of rentable space, about 110,000 square feet is occupied. Rents increased 6% to $10.60 per square foot and are expected to increase another 4% to 5% in 2023. Inventory is expected to remain tight in the near term.
Class C
The Class C office building finished 2022 with an occupancy rate of 99%. Of the total rentable area of 123,000 square feet, just over 122,000 square feet was actually occupied. Rents increased 3% to $10.13 per square foot.
Tips for Renting Office Space for Your Business
There are many factors to consider when choosing office space to rent. As with most real estate decisions, location is the biggest priority. Other considerations include parking, security, visibility, tenant synergies, and the cost of necessary repairs and renovations.
Potential tenants are advised to create a checklist of their needs before choosing an office space to rent. Some questions to ask include:
Does your office need a customer waiting area? How many restrooms? A kitchen or breakout area? One or more meeting rooms or presentation spaces?
position
An ideal location is one that is easily accessible to customers and, ideally, has a short commute for most employees. Talk to current and former tenants to get their overall impressions of the area and the surrounding area. Are there restaurants nearby where you can take clients or job seekers to lunch? What are the crime trends in the area?
building
Important building characteristics include aesthetics, the age of the building, and convenient access to offices.
First, consider the aesthetics of your building. You need a place that will make a good impression on your customers and provide a comfortable working environment for your employees. Your rental commercial property should look well-maintained, clean, and professional in appearance. Make sure your building has enough parking spaces for your customers and employees.
Second, the age of a building can affect more than just its appearance. For example, newer buildings often have higher quality heating, air conditioning, plumbing, and electrical systems. If you're considering space in an older office building, be sure to check whether these important systems are up to date and properly maintained.
Third, make sure your building has adequate security. Customers and employees need to feel safe when entering and exiting the building. Check if there are security cameras, alarm systems, and other security features. Make sure important equipment is safe from theft and vandalism when the office is closed.
Finally, interview the landlord and get reviews from current and former tenants. Key criteria include professionalism, reliability, and friendliness.
space
Choose an office space large enough to accommodate your team and all essential equipment. Leave some room for expected growth, like hiring new employees, but avoid excess space, which will waste valuable resources.
Decide whether you need separate offices for each employee, or if an open layout would be best for your team. Ask your landlord what changes you can make to the space. For example, can you paint the walls in your brand colors? Can you change the flooring, lighting, or other aesthetics? Can you add or remove walls?
Ask your landlord who is responsible for maintenance and repairs before and after you move in. Will the landlord make any necessary repairs before you move in, or will you have to do them yourself?
Fee
Determine your budget range before you begin your search. Estimate how much space you can afford. Consider the total costs associated with leasing, including rent, utilities, maintenance, and various other fees. Think about how long you plan to lease the location for. Do you plan to move to another space in the future? Or do you plan to make this the permanent home of your company? If you plan to relocate, ask your landlord about penalties for ending the lease early.
Work with trusted CRE professionals
Whether you’re a start-up or an existing business looking for a new location, working with a reputable commercial real estate company is essential to selecting high-quality commercial real estate properties and providing you with the best office space for rent.
Above all, finding the best solution requires an experienced real estate professional who listens carefully to your needs. A trusted real estate broker has a deep understanding of the local market and a keen eye for finding the best locations for different types of businesses. They also have extensive knowledge of leasing agreements.
Commercial One Brokers has over 60 years of combined experience with commercial real estate in the Branson area, and we have helped numerous clients of all sizes and budget ranges find the perfect office space to grow their business.
If your organization needs office space and you’re not sure where to start, give us a call at 417-334-3149 or contact us online today.