How Much Do You Value Your Office Space?

reason asks: "I've heard that office space costs around $10,000 per employee, and sometimes much more. I have a great office: it's a nice size and I have a lovely view out the window. It's a good working environment, and I know I'm lucky. Still, if it came down to dollar terms, I'd be willing to share my office with a colleague or even move into a cubicle in exchange for a mere $5,000/year pay rise. Am I undervaluing what I have? If you have an office to yourself, how much would they have to pay you to make you willingly give it up? If you don't have an office, how much of a pay cut would you be prepared to take to get one?"

Comments

Re:Cost is way lower, differential cost is even le

[whoever57]

Most relevantly, maintaining a physical presence costs a company between $5 and $10 an hour. As a full-timer, that comes out to at least $10k per year.

Some quick calculations based on the office where I presently work and the last place I worked, including things like HVAC, insurance and cleaning, show a figure of $5k/year per employee to be quite generous.

I did not include the cost of buying or leasing furniture, PCs, etc.

This report has details of rental rates in San Jose: $23 - $30 per square foot. At less than 200 square feet per employee (10 x 10 office plus shared space), that comes out to less than $6k. There are plenty of less expensive places in the Bay Area (although San Francisco is more expensive).

Actual office space costs from a business owner.

[SlashChick]

I own a small business that calls downtown San Jose its home. We lease office space that is about 1300 square feet and split it with another small company. Rent is $1.26 a square foot (but the landlord is now offering the office space above us for $1.15...bastard!) :(

We have 4 people in the office currently, plus a nice-sized workbench space to build servers and a conference table area. We could easily fit 5 people in the same space.

Rent, plus electricity, water cooler, phone, and 6Mbit DSL connection, costs around $1300 a month. $1300 divided by 5 people is $260/month per person. That, on a yearly basis, is $3120 per employee.

Yes, I suppose we could all work from home and save the money, but productivity would be dramatically decreased. For one thing, we do a lot of datacenter work, and we need quick and easy access to the datacenter during business hours (and space to build servers!) Plus, I like the "office environment" where we can easily chat with each other. A lot of ideas come out just from us talking. Plus, there is a comfy couch where anyone in the company can crash out or just sit and think, and some snacky things to chew on while pondering problems. These are fun amenities that I couldn't justify the cost for as easily if they were at my house. ;)

Also worth mentioning is the comfort our customers derive from us having an office. It's a lot easier to sell customers on our dedicated servers and colocation services if they know they can come knock on the door whenever they have a problem. For whatever reason, the "everyone works at home" thing is not considered a professional way to run a small business, and having an office is seen as a must-have for customers to take us seriously.

Re:Don't forget the "More Important" factor

[Usquebaugh]

Really,

my take would be they'd rather share a small office together than be stuck with you.

Re:Per Square Foot

[cameldrv]

Hate to break it to you, but office rents are almost always quoted in dollars per square foot per year, not per month. $40, even in Canadian dollars would be an astronomical price for space. They were probably spending about 8% of your salary on space, not 100%.

Re:Google and Me

[sysadmn]

Everyone talks about the increase in communications from shared space, but no one seems to factor in the productivity hit that comes from having to listen to other people's meetings on speakerphone, or time spent in a corner of the hallway making personal calls. I don't spend a lot of time on personal business, but there's times I need to call a doctor to get a prescription written or talk to a child's teacher. My coworkers don't need to hear that any more than I need to hear them discussing their divorce with their attorney. If you're designing a cube hell, for heaven's sake, add a few phone booths!

Re:Cost is way lower, differential cost is even le

[benzapp]

Umm, my office is 250 square feet and our rent is approximately $45.00 per square foot for a prime Midtown Manhattan location. That works out to $11,000 a year in rent just for my office. There are also utility reimbursements, garbage collection fees, insurance for the property, etc.

I don't know what sort of office rent statistics you are looking at, but even downtown SF is going to be $35.00 PSF for Class A office space (unless you have a huge company and get some sort of bulk discount).