Office Move Budgeting
Your office lease ends within the next 2 years, and you’re asking yourself the all-important question: should we renew the lease or move to a new space? For many, this is a big decision with far-reaching consequences.
Whether you’ve already decided to move or make your stay-vs-go decision, an office relocation budget is essential. Without this, you’ll lack the context to make a good decision and risk wasting huge amounts of time, effort and money.
“So what should my office relocation budget be?” you ask. Well, unfortunately, our answer is “it depends”. There are many different factors that will impact the cost of your prospective office move. There’s no simple formula – if there were, we’d give it to you.
What we can do, however, is walk you through the key budget lines, explaining what is involved, benchmark costs, and the factors that will drive that cost up or down. By the end of this article, you’ll be able to understand what your office relocation cost might be, and you’ll be able to set the right initial budget for your project.
Setting Your Brief
Before trying to set a budget for your office move, it’s crucial to create an initial brief. This ensures your budget is based on your actual needs, rather than assumptions. Otherwise, you could be delivering an office move that doesn’t meet the needs of your people and company.
The key elements of your relocation brief should cover workspace strategy, project objectives, new lease requirements, and new workspace requirements. Learn more about creating a great office fit out project brief here.
It’s tempting to jump straight to the budgeting phase. However, this is a mistake. Poorly planned projects often suffer budget overruns of 15-20% due to mid-project changes. The cheapest office relocation is a complete waste of money if it doesn’t meet your needs.
A well-founded and detailed brief allows not only for more accurate forecasting but helps to ensure your finished new workspace meets the needs of your people and company. This brief will become more detailed and likely change as you go through the early stages of the process, but starting with a good brief is essential to a successful project.
Office Relocation Budget
Planning and Consultancy
The first major budget item of an office move is to engage a workspace consultant. They will help you understand your workspace requirements, build a more detailed brief, and help you choose a new office space.
Depending on the size of your space and the complexity of your requirements, this will cost somewhere between £2,000 and £20,000. At the lower end of the scale, this will be a light-touch process to help you develop your brief, while a full process will involve space utilisation analysis, engagement workshops, and test fits for new spaces. It may not always be necessary, depending on your experience and the complexity of your project.
Finding a New Space
The next significant cost to consider will be engaging a commercial real estate agent to help you find a new space. They will take your brief and identify a shortlist of properties for you to view. They may then help with the negotiations and surveys.
In many cases, there will not be an upfront cost to appoint an agent – they will usually charge 7-12% of the first year’s rent or a percentage of the savings they negotiate. However, you will need to agree on this before appointing them.
New Space Costs
The largest single cost of your office move will be the lease of your new space. This not only includes the rent itself but service charges and utilities costs. For easier comparison, spaces are usually advertised at a cost per square foot per year. Depending on your office design, your staff will need between 100-200 sq/ft per person, including common areas.
The cost of your office space will be heavily dependent on the location of the space. Central London is significantly more expensive than greater London and the rest of the UK. In London, lease costs range from £65 to £135 per sq/ft per year, depending on the location and quality. Most other key cities in the UK will cost around £40 per sq/ft per year. To learn more, read How Much Does It Cost To Lease Office Space In London?
Survey & Legal Costs
One cost that is often not budgeted for initially is the due diligence for the new space – your survey and legal costs. As part of your due diligence on your preferred space, you should engage a third-party surveyor to assess the state of the buildings and amenities. Specialist legal advice is also essential.
Premises survey costs in London range between £750 to £5,500. This will differ depending on the condition and size of the premises being surveyed, as well as the detail of the survey you require. Your legal costs for signing a lease will likely be between £5,000 and £25,000. It may be higher or lower depending on the size of your space and the terms of the lease.
Dilapidations of the Old Space
Another commonly neglected budget item is the dilapidations works of your current office. Nearly all lease agreements stipulate that your office must be returned in the state in which it was leased to you. This means that you’ll likely have to strip out all the partitions, redecorate, and reconfigure the utilities to their original state.
Depending on how much you have changed your space from its leased state, this will likely cost between £10 and £20 per sq/ft. Often, the landlord will be willing to negotiate a settlement sum payable to the landlord, and they will waive the dilapidations clause.
Design of the New Office
Arguably the most important (and exciting) part of your office relocation is the design of your new space. It’s often under-resourced, but it’s crucial to the long-term success of your project. This involves your design & build company creating concept layouts and designs, and then working together to translate that into a fully deliverable package.
You can generally expect to spend around 2-4% of your overall project costs on the design. The cost is similar regardless of whether it is split out as an upfront cost, or included in the overall project delivery quote. The experience of the designer, the complexity of the design, and extras such as CGIs will impact the cost.
Fit-Out of the New Office
After the lease of the office space, the next biggest budget item will be the fit out of your new office. This involves installing new partitions, adapting the power and air-conditioning systems to suit your needs, and supplying and installing all the furniture, fixtures, and equipment that go in your new space.
The sq/ft cost of your office fit out is hugely variable, depending on the size of the space and the specification of the materials, as well as the current state of the space and the scope of the works.
Based on office fit out projects we’ve carried out recently, most office fit outs will range from £65 to £160 per square foot. This means that for a 10,000 sq/ft space, a full category B office fit out would cost from £ 650,000 to £1,600,000. To find out more about what your project will cost, download your office fit out costs guide.
Relocation of Staff and Equipment
The final major budget line to consider for your office relocation is the actual relocation of your equipment and staff belongings to the new office. This is the first cost that comes to mind when companies think about budgeting for an office relocation. However, it’s only a relatively small percentage of the cost.
Again relocation costs vary hugely. Most relocations will cost £3-£7 per sq/ft. The ease of access to both offices will have a big impact on the complexity and cost of your move. The distance between the two offices will also play a part, as will how much furniture and fixtures need relocation.
Setting Your Office Relocation Budget
Setting a realistic office relocation budget is the cornerstone of a successful office relocation project. Set it too low, and you’ll almost certainly end up with a poor space, and likely run over budget in the process. Set the budget too high, and you’ll struggle to get signoff for your move, ending the dream before it’s begun.
By starting with a detailed brief, you gain clarity on your needs, align the budget with your business goals, and avoid unexpected costs. Breaking down the major expense areas—from planning and fit-out to legal fees and relocation logistics—helps you allocate funds effectively and stay in control.
An office relocation isn’t just an expensive project. Done right, it’s a valuable investment in your staff's performance and your company’s future. A new workspace can inspire your team, boost productivity, and strengthen your culture. However, it all starts with a good budget.
To take the next step, get your own Ultimate Office Relocation Guide. It’s one comprehensive guide that will help you understand everything that goes into an office relocation, what it costs, and how long it will take. Inside, you’ll find benchmark costs, comprehensive checklists, timeframe guides, and detailed explanations. Get your Relocation Guide here.
To learn more about office relocation, read Office Relocation Costs 2024, How Long Does it Take to Move Office? and Office Refurbishment v Office Relocation - Which is Best for Me?
