When it comes to leasing or purchasing office or industrial space, choosing the right size can have a significant impact on your business’s bottom line. Paying for too much space results in unnecessary costs, while too little space can hinder productivity and operational efficiency. Understanding how much space your business truly needs is crucial to making a smart financial decision.
Office Space: How Much Do You Need?
A good rule of thumb for office space allocation is about 100 square feet per person. This accounts for a personal workstation, circulation areas, and some shared spaces. However, different office setups may require adjustments:
Traditional offices: 150–250 square feet per person (to accommodate private offices and meeting areas)
Open-plan offices: 100–150 square feet per person (more shared workspaces and hot-desking)
Co-working & flexible spaces: 50–100 square feet per person (designed for high-efficiency use of space)
Other considerations include the need for conference rooms, break areas, storage, and specialized spaces like labs or server rooms. Hybrid work models, which combine remote work with in-office collaboration, may allow businesses to reduce their overall footprint while maintaining employee productivity.
Industrial Space: Calculating the Right Fit
For industrial space, the calculation depends on the type of operations:
Warehouse & distribution centers: Typically require 500–1,000 square feet per employee, depending on racking systems and automation.
Manufacturing facilities: Space needs vary widely based on equipment, assembly lines, and storage, but a common range is 750–2,000 square feet per employee.
Flex spaces (office + industrial): Combining office and warehouse space requires balancing both needs, often allocating 20–30% of the total space for office functions and the rest for industrial use.
Key factors influencing industrial space requirements include ceiling height, loading dock access, storage capacity, and workflow efficiency. Proper planning ensures the space supports operations without unnecessary overhead costs.
Strategies to Optimize Space Utilization
Assess Current and Future Needs – Consider not just current headcount and operations but also potential growth over the lease term.
Embrace Flexible Workspaces – Hybrid work models and shared workstations can reduce the square footage required per employee.
Optimize Layout & Design – Efficient space planning can maximize usability, reducing wasted space.
Negotiate Smart Leases – Consider subleasing options or short-term leases if your business is in a growth phase.
Use Space Management Technology – Data-driven space planning tools can help businesses make informed decisions.
Final Thoughts
Selecting the right-sized office or industrial space is essential for cost savings and operational efficiency. By carefully assessing your needs and optimizing space usage, businesses can minimize expenses while maintaining productivity. Whether you’re expanding, downsizing, or launching a new location, strategic space planning ensures your real estate aligns with your business goals.