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9 September 2023, 09:48
Are you rethinking your office space? Is your charity spending more than it should on its property? And are there substantial savings to be made? Jonathan Vanstone-Walker from TSP shares 11 different ways your charity can save on its property costs.
The cost of living crisis continues to bite hard and charitable organisations continue to further reduce their outgoings and save money. Below are 11 ways you can do just that on your property:
No rent. No service charge. No commuting costs. What’s not to like? Going remote will save you thousands of pounds. And that’s why many charities are already full-time working from home (WFH). It works best for smaller, experienced teams who can work autonomously.
However! Watch out for hidden costs. Giving people a full WFH set-up isn’t cheap. There will be increased transport costs when staff travel to meetings and then there’s the question of who pays for home internet or utilities.
I love the office but there’s no doubt you will make a massive short-term saving with WFH. Some small charities should definitely consider it.
It’s a simple equation: less space = lower costs.
This is the number one option for our clients. When your next break option or lease expiry arrives, it’s time to rethink your premises strategy. Are you truly set up for hybrid working? Most people aren’t.
We’re not going back to the workplace of 2019. So, you’re best adapting to hybrid and right-sizing your office today – not wasting money on unused space. Taking less space means lower running costs too, so you’re winning all-round: all the benefits of an office, for less money.
These days there are more spaces that cater to downsizers – so it’s easier than ever to find a great office that’s the perfect size for you.
Are you picturing a rabbit warren of white cubes and that dance from The Office? Things have moved on since the noughties.
Today’s flexible offices are collaborative and inspiring, not drab and soulless. They’re places where you can rent a private office while accessing shared meeting rooms, cafes, and other shared spaces. They’re a great solution to the hybrid working dilemma.
Beware of private sector office spaces though. The problem is that the all-inclusive packages include full business rates payments that can’t be removed: making it very expensive for charities.
Do you have spare space in your building? Why not put it to work? There are hundreds of downsizers looking for shared offices. They would love to pay rent to your charity too.
I’ve also seen clients succeed by renting out single desk spaces to smaller charities. This takes a little more work but creates an income fast.
Or, if your building is historic and interesting, could it be a good venue for events, weddings, offsite meetings, etc? Be creative and tap your local market and network.
Time for a Martin Lewis moment. A broker will help you decide if it’s wise to fix your prices now. Sustainable and renewable energy does cost more - try and use it if you can.
Other than changing supplier, doing the basics right is the best way to make savings:
The problem is these easy things get overlooked and considered ‘not important’. So, appoint someone your ‘Sustainability Supervisor’ and task them with cutting your spend. Give them goals and help them by buying cheap monitoring devices to track live consumption.
Share results with your team and you’ll win their buy-in. And not a laminated passive aggressive ‘TURN THE LIGHTS OUT’ note in sight!
It sounds counterintuitive but refurbishing your building will save you money.
You’ll avoid the shock of unexpected and expensive repair bills. You’ll adapt to hybrid working while freeing-up space that prints money. Plus, energy efficient upgrades kill your electricity bills.
Refurbishment costs increase every year, so if you’re thinking of upgrading, the sooner the better. You’ll enjoy the benefits now while making inflation-busting savings.
It can take years of dedication and work, but getting a grant to improve your building is sometimes the only option available to smaller charities. Lots of people ask me where to start.
Registering for the Charity Excellence Framework’s outstanding ‘Free Funding Finder’ is the place to start (and it’s free). It’s the best list of active funding opportunities that I know of.
If your project will capture peoples’ imaginations or even media attention, then a GoFundMe appeal is also an option.
You can get a better deal just for staying in your rented property. This is how TSP began life back in the great financial crisis. We would renegotiate leases and make huge savings for our clients. We still do it today!
Think about what you’d like, then ask for it.
Sounds unbelievable, but sometimes it’s possible to give up your lease. Surrendering your lease means the landlord lets you walk away in return for a single payment, or sometimes even for free.
You never know what an owner’s plans are; they might be happy to get the building back to redevelop. It’s happened before and will happen again.
If you don’t ask, you don’t get!
A dilaps bill is an inevitable cost of the right-sizing process. But the amount you pay is not a foregone conclusion. You can often do the repairs for less money.
Cash-settling is recommended because dilapidations payments do not always attract VAT (where as project work usually does). Besides, landlord claims can be over-inflated. Or they might want to refurbish or redevelop the property, and when they do, dilaps bills get squashed.
We aim to save 50%-60% on the quoted rate which adds up to thousands.
Inspired by this list? I hope so. If it’s sparked some ideas but you need a little more help – make an action plan with a property professional. They will help you to identify and negotiate savings. They will also give you market insights and valuations that help to underpin your decision making.
TSP offers a free 30min call to any charity that needs it. Please free to get in touch.
About the author
Jonathan Vanstone-Walker is Managing Director of TSP, a property investment and asset management business. Jonathan has specialised in the charity sector for more than 12 years and advises some of the UK's most well-known non-profits and social enterprises. Jonathan specialises in providing strategic real estate advice, with a focus on offices.