Is your property made to measure?

At this time of year, most of us are already struggling to maintain our New Year's Resolutions, which normally entail trying to improve personal health and wellbeing.

But what New Year resolutions should the prudent Swindon businessperson have made?

Not too surprisingly, as far as Simon Kingsley is concerned, they all revolve around property.

After all, the importance of taking a property perspective can perhaps be better understood when you consider that property forms the second biggest overhead behind labour for UK Business Plc.

Consequently, Simon has come up with a series of five New Year resolutions which will help you get the most from your premises, be it a factory or swanky office block.

He has called them for very obvious reasons the Five R's.

Rents are up to £19.50 per sq ft for offices and £7 per sq ft for industrial/warehouse space in Swindon, and slightly lower for other Wiltshire towns.

This can equate to a significant overhead and any savings on rent will come straight off the bottom line.

If in 2004 you have a lease expiry or break clause there will be an opportunity to renegotiate the rent and/or relocate, but don't forget that the package does not stop at the headline rent per square foot/square metre.

The best deal may well involve a rent-free period, contribution to fitting out or relocation costs, and future flexibility through upwards and downwards rent reviews and regular break clauses.

This package should be tailored to meet the tenant's needs, which is impossible without the professional guidance which is essential to avoid costly mishaps.

Even without a lease expiry there may be opportunities to keep that rent bill as slim as possible if you have a rent review in 2004 ensure that you take proper advice so that any increase is minimised, and in certain circumstances it may even be possible to agree a rent reduction.

Rates form a significant overhead, and one for which there is often little tangible benefit.

Unfortunately there is no way of escaping the rates bill, although there are ways to reduce the pain.

The main method of obtaining a rates reduction is through the appeal system, however a detailed knowledge of rating law, how the system works, the property market and local values is required before entering this particular minefield.

While many businesses successfully appeal for a rates reduction, others simply pay up without realising when or how to lodge an appeal.

Even worse, others engage 'rating advisers' who persuade them to part with money up front in return for the promise of a future rebate.

This is the cowboy end of the market where the chances of success are slim at best, and if you are approached on this basis be very cautious.

Far better to take advice from a member of the Royal Institution of Chartered Surveyors, who is experienced in rating matters and who can deal with the appeal and negotiate the best settlement with the Valuation Office Agency.

Merging offices can be beneficial through reduced overheads and the unique opportunity to introduce new, more efficient working practices.

Companies operating split sites for manufacturing, sales, admin or distribution can significantly improve efficiency by bringing all of these operations together and reducing the down time and expense associated with increased management, travelling and communications needs. Even if you only operate from a single site, how sure are you that the space on which you pay rent is efficiently utilised?

Proper space planning may highlight opportunities to rationalise or consolidate, which had not previously been considered.

There are many examples of companies which have expanded in response to immediate market demands without careful consideration of long term needs or budgets.

They can end up locked into long term leases on premises which are no longer required, when in fact short term leases or serviced accommodation may have been a more appropriate and ultimately more efficient way of meeting extra short term demand.

Many older buildings are inherently inefficient in the following ways:

Location

Operating your business from the wrong location can have transport implications for the company, staff and customers alike.

An inappropriate location may damage business due to the immediate surroundings, particularly in sectors where image is important.

Size

The size of the property your company occupies is directly proportional to your rent bill, as rent is paid on every useable square foot or square metre. If your current building is too large, consider relocating to something smaller and cheaper, and there are many good deals to be had if you shop around.

Specification

Older buildings may be inefficient or inflexible, for example, industrial buildings with low eaves height may preclude full height storage, and small or poorly configured loading doors may increase turnaround times for deliveries.

With offices, matters such as efficient IT operation and cable management are essential for the smooth running of the business.

Condition

The cost of repairs will be an important factor particularly in the case of a tenant with a full repairing lease

Environmental

Older buildings are usually less environmentally-friendly than newer buildings and consequently will be more expensive to run.

Legislation

Ongoing legislative changes are likely to be more difficult and expensive to manage in older buildings.

For example, the statutory need to monitor and control asbestos within the workplace, and the forthcoming implementation of the Disability Discrimination Act which will require employers to address matters such as disabled accessibility to their property.

If any of these points apply to you and your business, you should consider a relocation to a more appropriate, efficient and ultimately cheaper building.

Swindon is a dynamic town which has benefited enormously from rapid changes in technology and a consistently high GDP.

Combined with fewer historical and heritage constraints than many surrounding cities and towns, this has generated one of the highest urban expansion rates in Europe in recent years.

In some cases in Swindon, buildings not much more than 20 years old have reached the end of their economic life and are now being considered for redevelopment.

Central government guidance is pressurising local authorities to allocate a greater proportion of new housing to brownfield sites.

Owner occupiers of numerous commercial properties and sites in Swindon and Wiltshire have benefited from a windfall through the allocation of their sites for residential redevelopment.

In Swindon's town centre many office buildings developed in the 1960s and 1970s have become economically redundant and are either being considered for redevelopment or conversion to alternative uses, predominantly residential, where values are at a higher level than for continued office use.

Even if your company occupies the property under a lease but does not own the site, it may be in your landlord's interest to share any development upside with you in order to secure vacant possession to enable early redevelopment.