Real Estate Update: Tech Spec For Workspace

Author:Mr Kevin Hoy
Profession:Mason Hayes & Curran
 
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Housing nine of the top ten global ICT companies, Ireland has become an international hub for tech activity. We examine some of the requirements which are important to tech tenants when leasing premises in Ireland and contrast those with the often conflicting needs of landlords. We also suggest steps Ireland could take to provide more suitable office space for tech tenants.

A comparison of tech tenant and usual landlord positions on lease provisions shows that there are substantial differences. Getting suitable space on appropriate terms is also a key requirement for any business. Ireland will copper-fasten its position as a leading centre for ICT business if it can reduce these differences while increasing available space.

The following table contrasts the key tech tenant requirements with the generally applicable position of landlords.  

Tech Tenant

Landlord

Term of Lease Tech start-ups generally require short term leases and/or early break options, as they have the potential to grow exponentially and therefore outgrow the space quickly. 

Term of Lease Landlords (and their debt funders) require certainty of return on their investment, resulting in a reluctance to provide space on a short term/flexible basis. 

Fit Out Tech companies provide a holistic offering for their staff and the fit out often includes a gym, canteen and other employee friendly facilities.  

Fit Out Landlords generally provide generic shell and core fit out and require full reinstatement to this condition at the end of the lease. This exposes tech tenants to extensive expenditure, both on commencement (fit out) and on termination (reinstatement). 

Access Tech companies need 24-7-365 access as their service is global and not limited to a couple of time zones or affected by particular national holidays.  

Access Such access is only really an issue if the building is multi tenanted. Other tenants may refuse to pay towards out of hours operational costs. The tech tenant may end up having to bear all the cost itself.  

Security Tech companies may require their own security and seek to restrict access for the landlord and its agents to certain areas within the premises. They may also require Non-Disclosure Agreements (NDAs) to be signed.

Security Landlords are often uncomfortable signing an NDA and will...

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