Setting Up Your First International Office: Getting the Workspace Right

Relocating operations to another country carries a certain level of excitement, tempered by legitimate uncertainty. You’ve done your market research, you have the regulatory aspects in mind, and now you face one of the more tangible realities of the situation: Is your new team going to work from a garage, a spare room, a rented boutique co-working space?

The space from which your employees operate does not only house cubicles and computers – it establishes how your team works together, works apart, attracts talent, and ultimately, how dedicated clients and partners perceive your legitimacy in this new market. Establishing a comfortable workplace by leasing early helps you avoid costly relocation later. Still, an international process isn’t as familiar as the one in your home country.

Get Local Market Expectations

Commercial real estate works differently based on where you’re going. Initial lease structure expectations, payment method options, and negotiation possibilities vary widely by city. Some landlords expect six months’ rent upfront. Others automatically assume quarterly installments for an initial fee. In some countries, property taxes are included in the rent; in others, they’re itemized on separate lines with maintenance averages and utility predictions.

These are not small nuances. They significantly impact financial forecasting and cash flow projections. A seemingly reasonable lease becomes an unrealistic monthly contribution when the landlord itemizes charges and effectively guarantees the tenant will be responsible for most non-inclusive miscellaneous payments without further discussion. Most expat business owners miss this reality by the time they’ve signed.

The documentation expectations from commercial landlords might also come as a shock. Most international leases require extensive company registration paperwork, tax certificates, and, in some cases, personal guarantees for director approval before anyone can sign employment contracts. Knowing what to expect before starting the actual search process helps reduce delays once you’ve found a space you love.

Location Matters Beyond Commuting

The location of your office is critically important relative to your market access. Yes, it’s where your employees will work and enjoy lunch breaks when they’re not working from home. Still, it’s also where your employees will use public transportation daily, or at least assess their ability to drive there/get there easily. A 20-minute commute versus a 45-minute commute can realistically dismiss qualified candidates from consideration for employment.

Certain areas in some international business hubs develop reputations, for better or worse. Financial services industry professionals thrive in one part of town. At the same time, technology entrepreneurs flock to the outskirts, while creative professionals are barely visible on community streets elsewhere. There’s usually a reason beyond tradition that people seek out these areas for their comparative advantage. There is often better access for those types of companies – fiber optic connections galore, proximity to other like-minded businesses, and a natural foot traffic that happens.

But with prestige comes higher rent. The question is whether there’s enough value in being located in “the right” part of town, or whether compromise is more critical. If you do not anticipate client foot traffic, or if your employees work best independently or across departments, paying $10/extra square foot/month for an address may not be worth it. Yet, if you’re intending on starting a consulting practice where perception drives productivity, that business card should read, “Downtown” – not “Eight Miles Outside of Town.”

Public transit access is more critical for some markets than others. In places where driving is an expense or inconvenience, your office location determines which candidates will even consider working for you. An accessible location is critical to attracting talent. If word-of-mouth potential employees determine that it takes them an hour to get to work one way within five miles (too many connections) or 45 minutes to get there in one shot (and the company across town will pay them $10/hr more), then you’ve lost an opportunity.

Space and Functionality Needs

One of the most complex parts of determining how much space you need is accounting for future growth in an unknown market. Asking people how much square footage per employee makes sense goes a long way; however, codes, commonplace layouts, and cultural workspace norms change drastically – and what works relatively well at home might be interpreted differently abroad.

Some countries rely heavily on open floor plans, with little need for private offices; others maintain older, more traditional layouts with cubicles and junior employees who feel entitled to personalized space. Knowing local expectations is critical to creating a work environment people want to be in, which ultimately supports performance and retention.

Many businesses that’ve established Singapore office rental or other competitive markets initially have more space than necessary, with the option to grow into it over time. This makes sense when lease terms are excellent, and markets are tight; however, expected growth may take longer than anticipated, resulting in delayed renovation costs and money spent on empty cubicles.

A preferred solution is to start small with guaranteed expansion options outlined in the lease agreement. This allows flexibility without overwhelming assumptions or establishing costs until months down the line, when it becomes clear that a smaller location won’t suffice. This isn’t always negotiable – primarily if multiple units exist in a larger building – but it’s worth checking out.

Terms That Favor You

International leases tend to run longer than expected with three-year minimums (generally five-year markets). This long-term commitment can feel daunting when you’re merely testing the waters in new territories, but owners willing to offer shorter terms charge much higher per-square-foot rates and grant less negotiating power.

The flexibility clauses matter just as much as the term. If your business contracts down the line and you no longer need as much space, can you downsize? If your client base grows rapidly and you need additional space immediately after starting operations, can you expand? Can you sublet if it doesn’t work out?

Unfortunately, these answers vary by location and owner credibility; however, some have break clauses that allow release at specified times within longer leases (usually with specific notice required). They cost something – higher rents or an upfront premium -, but they’re worth it when you’re entering unknown waters in foreign territories. The business climate changes rapidly in parts of the world; you don’t want to be stuck.

The renewal options should be vetted as well – automatic annual increases based either on market value surrounding average square footage rent or an inflation index might make lease-holders unhappy two years into their new commitment when they’ve already set up shop based on certain expectations that aren’t actually sustainable.

What Good Looks Like

The physical office you’ve selected is one thing; everything else around it that makes it functional is another. Reliability of Internet service varies widely from market to market (and sometimes across buildings in the same city). If you need connectivity for paid products/services rendered, it must be established before you sign anything.

Stability of electrical supply isn’t something one usually considers coming from a first-world country; however, uninterruptible power supply regulations might become part of your reality, depending on where you’re setting up shop, as might voltage, based on where items plug into walls.

Then there’s building management quality that’s noted over time – immediate maintenance responsiveness, reliable common area security, and professionalism occur when time goes by – these assessments are complex during vetting. Still, sometimes, other tenants in the building can provide credible insights.

Making The Decision

There’s no such thing as perfection when moving to an unknown market with budgetary constraints; however, location versus workable/negotiable space depends on what’s best immediately, while setting up shop, and providing future expansion ease if applicable.

Take time feeling out spaces over time – from morning till night – to see if a great building at 10 AM remains great at 6 PM when it suddenly becomes vacant or parking situations become complicated because everyone is there for work during the day but needs to take their lunch hour too far away. Lighting changes throughout the day, as do noise levels and air quality.

Follow your instincts — and back them up with solid data. What does it cost per employee, all in? What does it feel like at rush hour? Is there effortless access to local options?

The first international space is how you set up shop in this particular market. Choosing a reasonable solution does not guarantee perfection, but making it workable provides context for future business success.