Leasing office space in 2026 looks very different than it did even a few years ago. Hybrid work has reshaped how companies think about space, vacancy remains elevated in many markets, and construction costs and lease structures carry real budget risk.^1,2

The upside is that tenants often have more leverage than they realize — if they follow a clear, data-backed process. This guide breaks down the essential steps U.S. businesses should take to size space correctly, build a realistic budget, compare lease structures, and negotiate terms that protect flexibility and cost control.

• Right-size for hybrid work. Many offices now plan for roughly 100–150 square feet per employee, well below past standards.³
• Budget beyond base rent. Build-out costs, operating expenses, and escalations can materially change the true cost of a lease.^4,5
• Use market conditions to your advantage. Elevated vacancy in many markets gives tenants more negotiating power — if they know how to use it.²

How to Use This Checklist

Work through each step in order and document your assumptions as you go — headcount, space per employee, budget range, and preferred submarkets. Bring this framework to tours and negotiations so decisions stay grounded in numbers, not guesswork.

If you don’t have an in-house real estate team, pairing this checklist with a tenant-representation advisor can help stress-test assumptions and surface risks before they become expensive.

1. Define Your Business Needs First

Start with how your people actually work, not a square-footage guess. Hybrid schedules, meeting frequency, storage needs, and acoustics should drive the plan.

The old rule of 200+ square feet per employee is largely outdated. Many hybrid offices now plan for 100–150 square feet per person, especially when in-office attendance is staggered.³ From there, outline non-negotiables such as:

• Focus rooms and collaboration areas
• Reception and security requirements
• IT, power, or ventilation needs
• Building amenities like parking, bike storage, or transit access

Clarifying these details early helps eliminate mismatched buildings quickly and keeps tours focused on viable options.

Example:
A 30-person team with roughly 60% daily attendance may target 3,000–3,600 usable square feet, depending on meeting density. From there, circulation and building load factor determine total rentable square footage.

2. Set a Realistic, All-In Budget

Base rent is only part of the picture. A complete budget should include:

• Rent and annual escalations
• Operating expenses or CAM
• Utilities, janitorial, insurance, and taxes
• Furniture, IT, and security
• Move costs and professional fees

Office build-outs can vary widely depending on scope and market, and tenant improvement allowances often don’t cover the full build.^4,7 Many tenants underestimate upfront capital costs and long-lead items, which can create pressure late in the process.

Build low-end budget and high-end budget scenarios, validate them with local market data, and understand how usable versus rentable square footage affects total cost.

3. Choose Location With Commute and Access in Mind

Map where employees live, how often they plan to come in, and how they prefer to commute. Walkability, safety, and access to food and services matter more in hybrid environments than prestige alone.

Office markets remain uneven. Well-located, high-quality buildings continue to attract demand, while older or less efficient assets often carry higher vacancy.^2,8 That imbalance can create negotiating leverage — especially when multiple viable options exist.

Shortlist submarkets that balance employee convenience with client access, then compare rents, concessions, and floor-plate efficiency before touring.

4. Understand Office Lease Types Before Comparing Deals

Lease structure determines who carries cost risk over time. Common office lease types include:

• Full Service Gross (FSG): Base rent includes most operating expenses⁶
• Modified Gross: Some expenses are included, others passed through
• Triple Net (NNN): Tenants pay taxes, insurance, and maintenance in addition to rent⁵

Before comparing rates, confirm:

• What expenses are included
• How escalations are calculated
• Whether caps apply to controllable costs
• Audit and reconciliation rights

Two leases with similar asking rents can have very different long-term costs depending on structure.

5. Shortlist Properties Strategically

Once criteria are set, cast a wide net — then filter aggressively. Elevated vacancy in many markets gives tenants more options.²

As you tour, focus on:

• Natural light and noise levels
• Elevator access and common areas
• HVAC hours and after-hours costs
• Fiber providers and backup power

Always confirm both usable and rentable square footage. Differences in building efficiency can significantly affect how many employees a space can actually support.

6. Evaluate Lease Terms and Flexibility

Rate matters, but terms matter more over time. Pay close attention to:

• Lease length and renewal options
• Expansion or contraction rights
• Sublease and assignment language
• Security deposit requirements
• Restoration obligations at lease end

Tenant improvement allowances often fall short of full build-out costs.⁷ If certainty is critical, consider negotiating a turnkey build with a clearly defined work letter that outlines scope, timelines, and cost responsibility.

Flexibility clauses can protect against headcount changes and reduce the risk of overcommitting.

7. Negotiate With Data, Not Assumptions

Arrive at negotiations with comparable deals, multiple options, and a clear sense of priorities. Concessions may include:

• Free rent or phased rent schedules
• Additional TI dollars
• Operating expense caps
• Parking or storage concessions

Vacancy and longer marketing times often support stronger tenant terms, particularly in commodity space.² Focus on total cost and net effective rent rather than headline numbers alone.

Once business terms are aligned, move quickly to document them and keep momentum.

8. Review Legal and Compliance Requirements

Before signing, confirm that:

• The intended use complies with zoning and the lease
• ADA accessibility requirements are met
• Life-safety systems are up to date
• Insurance requirements are understood⁹

Local and state regulations can affect notice requirements, rent increases, and lease disclosures.¹⁰ A legal review helps ensure obligations are clear before execution.

9. Plan and Execute the Office Build-Out

Successful build-outs depend on early coordination between design, permitting, and construction. Lock long-lead items early and align furniture, IT, and AV plans with the build to avoid rework.

Clarify responsibilities in the work letter:

• What the landlord delivers
• What the tenant covers
• How delays affect rent commencement

For qualifying energy-efficient improvements, Section 179D of the Internal Revenue Code may offer deductions if requirements are met.⁴

10. Move In and Manage the Lease Ongoing

After move-in, treat the lease like a financial asset. Set up:

• Utilities and building access
• Janitorial and security protocols
• Emergency procedures

Review operating expense reconciliations annually and benchmark usage. If space becomes underutilized, explore subleasing or reconfiguration to reduce cost per employee.

Common Mistakes to Avoid

Tenants often underestimate:

• Build-out costs beyond TI allowances⁷
• Escalations and operating expense pass-throughs
• Restoration obligations at lease end
• Differences between usable and rentable area

Before choosing a space, compare your top options side by side using total five-year cost, not just rent.

How TenantBase Helps Tenants Lease Smarter in 2026

Traditional office searches can take months of back-and-forth. TenantBase simplifies the process by combining a free-to-search marketplace with tenant-only brokerage support.

Tenants input their requirements and receive curated matches, market context, and guidance from advisors who exclusively represent tenant interests. Clients working through the platform have achieved average savings of approximately 22% versus asking rental rates, with streamlined timelines from search to signed lease.¹¹

Final Thoughts

Leasing office space in 2026 requires more planning than it used to — but it also offers more opportunity for tenants who approach the process deliberately.

Right-size for hybrid work, budget beyond base rent, understand lease structures, and negotiate with data. With the right framework and support, tenants can secure space that fits today’s needs without locking themselves into tomorrow’s risks.

References

1. CRE Daily. Office market vacancy trends and national outlook.
2. CREXi. U.S. office market insights and vacancy analysis.
3. YAROOMS. Office Space Per Employee: How Much Do You Need?
4. Facilities Dive. Office fit-out costs, rent escalations, and Section 179D coverage.
5. Minnis CRE. Understanding Triple Net (NNN) Leases.
6. Visual Lease. Full Service Gross Leases and Budget Predictability.
7. Newmark. Tenant improvement allowances and build-out cost gaps.
8. CREXi. Submarket performance and prime vs. secondary office assets.
9. Travelers. 5 Things to Know Before Renting or Leasing Space.
10. California Lawyers Association. Overview of SB 1103 notice requirements.
11. TenantBase. Platform performance and tenant savings benchmarks.