I talked the other day with a new grad who was struggling to figure out where to locate his practice. He is in a large city in the Midwest, and he was looking at two locations:
1. One location is on a side street off the “main drag” but still within the area he wanted. It has limited visibility from the street. The rent is about $15 a square foot.
2. The second location is in a highly visible area in the area of a major retail mall. The office has a large sign on the street, of which he would have a small section. The rent is over $25 a square foot, including CAM (common area maintenance).
In addition, the first office is 1200 square feet, while the second office is 1700 square feet. He and his wife will be working together, so he figured the 1700 square feet would be good.
To figure the monthly rent: Multiply the price per square foot by the number of square feet to get the annual rent, then divide by 12. So monthly rent on the first office would be $1500 a month, while the rent on the second would be $3541.
So which would be best for this new DC? Consider the cost of advertising at the first location, since it’s not so easily visible. Marketers tell us there is a trade-off between rent and advertising, and this is a classic case of this situation.
Which office should this new DC rent? Reply by commenting. Sure, I have an opinion, but that’s all it is. I would like to hear from you.