Renew the Current Office Lease or Relocate to a New Office?

Businesses should renew their existing office lease when the space, location, and building infrastructure continue to meet operational requirements, and the total occupancy cost remains competitive with comparable properties. Office relocation is generally more suitable when the existing workspace is overcrowded, renewal costs are no longer reasonable, or the building fails to meet operational needs.

To make an informed decision, companies should compare the total cost over the full lease term, future expansion requirements, and potential business disruption.

1. Comparing office lease renewal and relocation

Renewing an office lease offers advantages in terms of lower transition costs and business continuity. Relocating to a new office, meanwhile, allows companies to reassess their space requirements, location, building standards, and lease terms based on current business needs.

The following table compares both options against the factors that directly influence corporate office leasing decisions.

In the short term, office lease renewal generally offers lower costs and greater operational stability. However, relocation may deliver better long-term value when the existing premises no longer support workforce requirements, operational standards, or business expansion plans.

Companies should compare the total cost of office occupancy over the same period, including base rent, service charges, refurbishment, office fit-out, moving expenses, and reinstatement obligations.

A new office with a lower rental rate per square metre may not generate actual savings once relocation and fit-out expenses are included. Conversely, renewing a lease may become less economical if rental increases over the new lease term exceed the recoverable costs of moving.

2. When Should Businesses Renew Their Current Office Lease?

Businesses should prioritize office lease renewal when the existing premises continue to meet their space and infrastructure requirements, the location remains convenient, total occupancy costs are competitive, and renewal terms can be negotiated to support the next phase of operations.

2.1 The space still meets operating needs

Lease renewal is a practical choice when the current office can accommodate daily work activities, meetings, client reception, and operational functions throughout the next lease term.

The assessment should consider the actual usable floor area, space utilization efficiency, and the flexibility of the existing office layout.

Factors to review include:

• Workstations: Enough seats for employees who regularly work in the office
• Functional areas: Sufficient meeting rooms, private offices, reception space, pantry, storage and collaboration areas
• Space efficiency: The area is used logically, without substantial unused or hard-to-plan zones
• Adaptability: The premises can be changed for new requirements without excessive cost
• Expansion: Adjacent space or a larger floor within the building may be available as the business grows

If the office can accommodate projected requirements throughout the proposed renewal period, such as a three- to five-year lease term, renewal is often more cost-effective than investing in a new location.

Companies should also review workstation occupancy during peak office days. Under a hybrid working model, total headcount may exceed the number of employees physically present at any one time, potentially leading to inaccurate office space forecasts.

2.2 Headcount is expected to remain stable

Renewing the current lease is appropriate when a business does not anticipate substantial changes in employee headcount, departmental structure, or working arrangements during the next lease term.

The forecast should cover:

• Recruitment and headcount-reduction plans
• The proportion of employees working from the office
• The extent of hybrid or remote working
• Plans to create new departments or business units
• The number of contractors, temporary staff and visitors
• Potential mergers or corporate restructuring

When workforce requirements remain stable, retaining the current office can help companies avoid leasing excess space or investing in larger premises that would remain partially unused.

However, businesses expecting substantial workforce growth or downsizing should assess the existing office’s capacity before committing to a long-term renewal.

For accurate office space planning, companies should distinguish between total employee headcount, simultaneous on-site occupancy, and the number of dedicated workstations. Each measure can lead to different space allocation and layout requirements.

2.3 The location remains convenient for employees and clients

Office location has a lasting influence on recruitment, employee experience, and access to clients. Businesses should consider renewing their lease when the current location continues to offer convenient access without creating substantial operational difficulties.

Review the following criteria:

• Accessibility: Convenient access by motorbike, car or public transport
• Commute time: Reasonable for where most employees live
• Business connectivity: Close to clients, partners, banks, government offices or key business districts
• Parking: Adequate capacity for employees and visitors
• Nearby amenities: Restaurants, banks, hotels, shopping centres and other necessary services
• Visibility: An address that is easy to find and convenient for deliveries and client visits

For businesses with an established presence at their current address, lease renewal also helps maintain continuity across business transactions, legal documentation, recruitment activities, and corporate communications.

When considering relocation, companies should review employee residential locations and the frequency of client meetings to compare accessibility between properties. The decision should reflect actual travel patterns rather than geographical distance alone.

2.4 The building still supports operations

Businesses should renew their lease when the building’s technical infrastructure, property management services, and amenities continue to meet their operational requirements.

This assessment should reflect the company’s actual experience throughout the existing tenancy, rather than relying solely on the building’s Grade A, B, or C classification.

Key areas to inspect include:

• Elevator performance and waiting times during peak hours
• Air-conditioning, ventilation, and indoor air quality
• Backup power systems and emergency power availability
• Internet connectivity, telecommunications infrastructure, and server room facilities
• Building security, access control, and CCTV systems
• Fire prevention and firefighting systems
• Cleaning standards and maintenance of common areas
• Property management response times
• Overtime access policies and after-hours air-conditioning charges
• Capacity to accommodate business-specific technical requirements

Where existing issues are limited and the landlord agrees to address them, the company can include the required corrective works in a lease renewal addendum to establish clear responsibilities.

For systems directly affecting business operations, such as backup power, air-conditioning, or telecommunications, repair commitments should specify the scope of work, completion deadlines, and responsibility for costs.

2.5 Total occupancy cost remains reasonable and competitive

Businesses should assess the total cost of occupying their office rather than focusing exclusively on the quoted rental rate.

Relevant expenses include base rent, service charges, taxes, parking, air-conditioning electricity, after-hours office usage fees, maintenance, office refurbishment, and periodic rent escalation.

A renewal proposal is commercially reasonable when the total cost reflects the quality of the premises and remains competitive with comparable office buildings in the same market segment, location, size range, and handover condition.

Companies should also calculate office occupancy cost per workstation to assess space efficiency more accurately.

For an objective comparison, companies should prepare a total occupancy cost analysis covering the same lease period, including scheduled rental increases and applicable incentives.

Refundable security deposits should be tracked separately as a cash-flow requirement, rather than automatically treated as a non-recoverable leasing expense.

Reference formulas: 

• Total Lease Renewal Cost = Rent over the lease term + Service charges and operating expenses + Refurbishment costs − Lease incentives
• Total Office Relocation Cost = Rent over the lease term + Service charges and operating expenses + Office fit-out costs + Moving, reinstatement, and overlapping lease costs − Lease incentives

Both scenarios should use the same evaluation period and consistent treatment of VAT, security deposits, operating expenses, and the residual value of existing fit-out and furniture.

Where commercial terms change from year to year, costs should be calculated for each relevant period rather than relying solely on the initial quoted rental rate.

2.6 Better renewal terms can be negotiated

Lease renewal provides an opportunity for businesses to review their existing commercial terms rather than automatically extending the current agreement under unchanged conditions.

Existing tenants may have a negotiating advantage because landlords can avoid the time and costs associated with securing replacement tenants, paying leasing commissions, and carrying vacant space.

Potential negotiation points include:

• Rent aligned with current market conditions
• A cap on periodic rent escalation
• Reduced or unchanged service charges
• Rent-free time for refurbishment
• A landlord contribution to repairs or upgrades
• A revised security deposit
• Priority rights to lease additional area
• The right to move to another area within the same building
• Assignment or subletting rights
• An early-termination clause subject to agreed conditions
• Priority renewal rights for the next lease cycle
• Clear landlord repair and maintenance responsibilities

If the landlord agrees to favorable terms, renewal can reduce the company’s financial exposure and provide greater flexibility throughout the new lease period.

To support negotiations, tenants should obtain quotations from several comparable office buildings, detailing rental rates, service charges, available floor areas, rent-free periods, and handover conditions.

The incentives available for negotiation will depend on market supply, building occupancy levels, and individual landlord policies.

2.7 The business prioritises cash-flow stability

Office lease renewal is suitable for companies seeking to limit major upfront expenditure and preserve capital for core business operations.

Remaining in the existing premises can reduce additional security deposits, office design and fit-out expenses, moving costs, overlapping rental payments, and reinstatement obligations. These savings are particularly relevant when the existing office fit-out and furniture remain in good condition.

However, businesses must also consider long-term operating expenses and whether the premises can accommodate future requirements.

A renewal with low initial expenditure may still prove less economical over time if rental rates increase repeatedly or substantial refurbishment becomes necessary.

Companies should therefore evaluate upfront cash-flow requirements separately from the total cost of occupancy over the renewed lease term.

2.8 No better alternative is available

Businesses should consider renewing their current lease when no available office can meet their requirements for location, floor area, rental budget, infrastructure, and handover schedule.

If alternative properties do not offer better overall commercial and operational value, retaining the existing office can preserve business continuity and avoid unnecessary relocation expenses.

However, tenants should carefully review the renewal notice requirements in their current lease agreement.

Delaying the search for alternative premises until the lease is close to expiry can weaken negotiating leverage and create uncertainty around future office occupancy.

3. When Should Businesses Relocate to a New Office?

Businesses should consider office relocation when their existing workspace can no longer accommodate employee headcount, the location becomes inconvenient for clients and business partners, or rental costs and building performance no longer meet operational expectations.

Before relocating, companies should determine whether these issues can be resolved through office refurbishment or renegotiated lease terms.

3.1 The office is overcrowded

When employee headcount increases without a corresponding expansion in office space, businesses may face workstation shortages, insufficient meeting room capacity, and limited room for further growth.

If the existing layout cannot be reconfigured effectively or the building has no additional space available, companies should begin searching for premises that support their anticipated growth over the next lease term. This is particularly relevant for businesses planning workforce expansion over three to five years.

Before committing to relocation, companies should assess existing workspace efficiency, workstation utilization, and opportunities to lease additional space within the same building.

If these options cannot accommodate projected requirements, relocation becomes a more justified decision in terms of space and cost.

3.2 The proposed rent increase is not justified

Businesses should consider relocating when the proposed renewal rate exceeds the asking rents of comparable office properties or is inconsistent with the quality of the premises and services provided.

Before making a decision, tenants should compare the total occupancy costs of buildings within the same grade, location, and handover category. They should also attempt to renegotiate rental rates, incentives, and related lease provisions.

Another consideration is the payback period for office relocation costs. If monthly rental savings can recover moving expenses, reinstatement costs, and new office fit-out investment within the proposed lease term, relocating may offer a financial advantage.

3.3 The location is affecting recruitment and operations

Office location directly affects accessibility for employees, clients, and business partners. A location that previously met business requirements may become less suitable as a company changes its target market, workforce size, or geographical coverage.

Consider relocation when:

• Most employees face long commute times
• The area has frequent congestion or weak transport links
• Candidates decline roles because the office is inconvenient
• The building cannot provide adequate parking
• The office is far from clients, partners or important business areas
• Nearby amenities do not support work or client meetings

For talent-intensive industries such as technology, finance, consulting, and professional services, an accessible office location can support employee recruitment and retention while reducing commuting difficulties.

Companies should verify these issues through employee surveys and actual traffic assessments during working hours, rather than drawing conclusions based solely on geographical distance.

3.4 The building is deteriorating or its infrastructure is outdated

Building-related issues such as overcrowded elevators, unreliable air-conditioning, insufficient backup power, poor internet connectivity, or declining property management standards can directly affect business operations.

If the landlord has no clear improvement or refurbishment plan, relocating to an office building with better technical specifications may be appropriate.

Businesses with specialized operational requirements should verify the new building’s backup power capacity, cooling systems, internet connectivity, and after-hours access arrangements before signing a lease.

A higher-grade office building does not necessarily guarantee that every tenant-specific technical requirement can be met.

3.5 The business needs to reposition its brand

Companies may consider relocating when entering a new growth phase, expanding into additional markets, or seeking to strengthen their corporate image.

A well-located office in a professionally managed building, with a modern workplace design, can support client reception, employee recruitment, and corporate branding at the new headquarters.

A brand-driven relocation should be linked to specific business requirements, such as hosting clients, organizing corporate events, expanding business development teams, or upgrading workplace standards.

Companies should weigh these benefits against the capital investment and contractual obligations associated with moving.

4. Key Considerations Before Renewing an Office Lease

Before signing a lease renewal addendum or a new lease agreement, businesses should review the overall cost, commercial terms, and suitability of the premises for the next leasing period.

The key considerations include: 

• Check the renewal notice period: Confirm the contractual deadline so the business does not lose priority rights or enter negotiations from a weak position.
• Reassess space requirements: Forecast headcount, working model and area needs for the next three to five years before committing to a new term.
• Survey market rents: Compare rent, service charges, incentives and handover conditions among buildings of the same Grade, area and size.
• Calculate total occupancy cost: Include service charges, parking, after-hours air-conditioning, refurbishment, rent escalation and other operating expenses.
• Review the premises: Inspect the fit-out, air-conditioning, electricity, internet, fire safety, lifts and any items requiring repair.
• Negotiate the renewal package: Discuss rent, rent-free refurbishment time, upgrade support and a lower deposit where appropriate.
• Control rent escalation: State the escalation rate, effective date and adjustment basis clearly in the lease.
• Add flexible provisions: Consider expansion, contraction, relocation within the building, assignment, subletting and early termination rights.
• Clarify repair duties: Specify the landlord’s responsibilities, incident-response timing and handover standards after any works.
• Keep an alternative: Continue surveying selected offices to test the renewal proposal and maintain negotiating leverage.

Before signing a renewal addendum, companies should prepare a side-by-side comparison of the existing lease and the proposed terms.

Any changes to rental rates, security deposits, lease duration, rent escalation, and maintenance responsibilities should be documented in writing to reduce the risk of future disputes.

5. Points to review before moving office

Before moving to new premises, businesses should carefully plan their budget, project timeline, contractual obligations, and operational arrangements to control additional expenses and minimize disruption.

The main considerations include: 

• Define the new requirement: Set the area, workstation count, location, building Grade, budget and technical criteria before surveying the market.
• Forecast headcount: Calculate three-to-five-year demand, including recruitment, hybrid work and possible departmental expansion.
• Budget the full move: Allow for the deposit, design, fit-out, furniture, transport and incidental fees in addition to rent and service charges.
• Review termination terms: Confirm notice, payment obligations, the deposit and all conditions for surrendering the current premises.
• Clarify reinstatement: Confirm demolition scope, reinstatement standards, working hours, after-hours fees and responsibility for remaining assets.
• Limit overlapping rent: Coordinate handover, fit-out and relocation to avoid paying for two offices for an extended period.
• Check handover conditions: Confirm the condition, handover date, rent-free period and each party’s fit-out responsibilities.
• Assess infrastructure: Inspect electricity, air-conditioning, internet, lifts, fire safety, parking and after-hours rules.
• Build a detailed move plan: Assign an owner, phase the programme and prioritise critical teams to maintain business continuity.
• Update corporate information: Plan changes to the registered address, invoices, bank accounts, website, legal records, signage and transactional documents.
• Notify employees and partners early: Provide sufficient notice, the new address, travel instructions and the new-office working plan.
• Prepare for delays: Maintain a contingency plan if fit-out, inspection, infrastructure installation or handover falls behind schedule.

Companies should pay particular attention to the relationship between three dates: the expiry of the existing lease, the handover of the new office, and the commencement of operations at the new location.

Poor coordination between these milestones can increase overlapping rental costs or create unnecessary business disruption.

6. Office Lease Renewal vs. Relocation: Decision-Making Scorecard

Businesses can use the following scorecard to compare lease renewal and relocation across the factors most relevant to their operations.

Each criterion is rated on a scale of 1 to 5, with higher scores indicating a better fit with the company’s requirements.

Before assigning scores, companies should establish mandatory requirements such as the maximum budget, minimum office area, essential technical specifications, and required handover date.

Scoring guidelines: 

• 1 point: Does not meet the requirement or meets it only to a very limited extent.
• 2 points: Partially meets the requirement but requires major adjustments.
• 3 points: Meets the basic requirement with some remaining limitations.
• 4 points: Meets the requirement well, subject to certain negotiable conditions.
• 5 points: Fully meets the defined requirement.

Companies should assign scores using actual information, including lease renewal quotations, refurbishment costs, relocation expenses, current market availability, and workforce projections.

To reflect business priorities accurately, each criterion should be assigned an appropriate weighting. Total occupancy costs, floor area, location, and technical infrastructure often warrant greater consideration.

The option with the higher weighted score should generally take priority, provided it satisfies all mandatory requirements.

If both options achieve similar scores, companies should continue negotiating renewal terms and evaluating alternative premises before reaching a final decision.

The scorecard is intended to support decision-making. It does not replace detailed cost analysis, on-site property inspections, or a review of lease documentation.

7. How early should the evaluation begin?

Businesses should generally begin evaluating office lease renewal or relocation options 9–12 months before their existing lease expires, as a suggested planning timeframe.

For larger offices, properties with complex technical requirements, or projects involving multiple approval stages, planning may need to begin 12–18 months in advance.

The actual timeline should reflect contractual notice periods, the availability of suitable office space, fit-out requirements, and the company’s internal approval process.

12-18 months before expiry: Assess long-term demand

• Forecast headcount and the working model
• Check whether the current area can meet future demand
• Review the contractual renewal-notice deadline
• Set the budget and leasing criteria for the next cycle

9-12 months before expiry: Survey the market

• Request a renewal proposal from the landlord
• Review market rents and availability in the area
• Shortlist suitable alternative offices
• Prepare an initial stay-versus-move cost comparison

6-9 months before expiry: Negotiate and select an option

• Negotiate rent, service charges and renewal terms
• Inspect shortlisted alternatives
• Calculate total rent, refurbishment, moving and reinstatement costs
• Submit the options for management approval

3-6 months before expiry: Complete implementation

If the company chooses to renew, it should execute a lease renewal addendum or new lease agreement and finalize any agreed repairs or refurbishment works.

If relocation is selected, this stage typically involves lease signing, office design, fit-out construction, inspections, handover, and the physical move.

Businesses must prioritize the renewal and termination notice deadlines specified in their signed lease agreements. These deadlines determine the parties’ contractual rights and obligations, while the 9–12-month and 12–18-month timelines serve as general planning recommendations.

8. How Maison Office supports office searches

Maison Office helps businesses reduce the time required to search for, compare, and select office premises that match their operational requirements, budget, and growth plans.

Based on each company’s leasing criteria, Maison Office consultants identify suitable properties, reducing the time businesses would otherwise spend researching the market independently.

For tenants considering lease renewal, Maison Office can also provide comparable office options to benchmark rental rates, available floor areas, building quality, and commercial terms before a final decision is made.

Support includes:

• Requirement analysis: Define the area, location, budget, lease term, building standards and technical needs
• Suitable-office shortlist: Compile available premises, rents, service charges and handover conditions for comparison
• Property inspections: Arrange visits and support evaluation of location, premises, infrastructure and management services
• Total cost comparison: Analyse rent, service charges, fit-out costs, incentives, rent-free periods and incidental expenses
• Lease negotiations: Support discussions on rent, deposit, lease term, escalation and flexible conditions
• Handover coordination: Work with the landlord, management team and related parties through contracting, handover and operational preparation

With over 10 years of practical experience in office leasing advisory services across Ho Chi Minh City, Hanoi, and Da Nang, Maison Office helps businesses access suitable office options, reduce contractual risks, and make leasing decisions based on market information and actual operational requirements.

Contact Maison Office to receive an updated list of available office spaces and leasing recommendations tailored to your business requirements. 

9. Frequently asked questions about renewing or relocating an office

9.1 Is renewing an office lease cheaper than relocating?

Renewal usually reduces design, fit-out, moving and reinstatement costs. However, the business must also consider the new rent, service charges, refurbishment and rent escalation over the next lease cycle to identify the genuinely lower-cost option.

9.2 Should a business inspect other offices before renewing?

Yes. Inspecting comparable buildings provides current evidence on rent, supply, incentives and handover conditions. That evidence also strengthens negotiations with the present landlord.

9.3 How early should a business look for a new office?

Begin evaluation and the office search about 9-12 months before expiry. For a large area, complex technical requirements or several approval levels, allow 12-18 months.

9.4 Which office-moving costs are often overlooked?

Commonly missed items include overlapping rent, reinstatement of the former office, after-hours fit-out fees, service-lift fees, asset transport, new signage and changes to the registered business address. Include a contingency reserve to control unplanned expenditure.

9.5 Can the lease be renegotiated at renewal?

Yes. A business can renegotiate rent, service charges, the deposit, escalation, rent-free time and repair responsibilities. Flexible conditions covering expansion, contraction, assignment and early termination should also be considered.

Bui Duc Huy

Editor and content team manager at Maison Office.

With over 5 years of experience in consulting and extensive content editing in the real estate services and interior design field. Sharing valuable information with customers, partners, and attracting millions of views.