Free Free Rent and a Decade-Long Agreement | Allegro

Perspectus Architecture is a full-service architecture firm that creates exceptional experiences for those in the healthcare, campus and cultural, senior living, civic and government, and commercial spaces, among other sectors.

After many years in a historic district and a looming lease expiration, Perspectus knew that their consistent, organic growth would continue, and they needed a larger, more modern space to accommodate that growth, their employees’ needs, and a work environment better suited for their style. Well aware of the need for additional, more accommodating space, Perspectus also knew that, if they were to continue growing at this rate, a new office was essential for both recruiting and retention. With additional space and style in mind, Perspectus’ priorities included:

• Modern office spaces with plenty of natural light. 
• An elevated professional presence. 
• Conference rooms to meet and anticipate a growing employee and client count.
• Additional building amenities, such as a fitness center and restaurant. 
• A multi-tenant environment, with more professional services nearby. 
• Excellent walkability, parking, and easy access for both employees and guests.
• After-hours safety. 
• The flexibility to expand over time.

Perspectus reached out to Allegro Real Estate Brokers & Advisors to help them find their ideal office.  

Orchestrating a Great Deal to Meet Unique Requirements for the Next Decade

Once Perspectus expressed their goals, Allegro identified several options that met their specific, timely needs. After Perspectus quickly eliminated eastern suburban options, Allegro focused strictly on downtown locations along with the lease renewal opportunity for Perspectus’ then-current space. 

The transaction was ultimately structured with four critical deal terms:

1. A right of first refusal allowing for optimal flexibility to expand.
2. Tenant improvement allowance coupled with significant free rent resulting in no out-of-pocket costs for the tenant, particularly considering the high quality of the build out—the free rent relieved economic pressures during the pandemic.
3. The ability to directly manage the construction project, utilizing a contractor with whom the tenant had a previous relationship and the elimination of landlord construction oversight fees.
4. A pandemic-based force majeure clause protecting the tenant from the lease commencing if tenant improvements were delayed due to labor shortages and/or supply chain issues.

While the deal was set to close near the end of March 2020, Perspectus faced an unprecedented challenge as it planned to complete the deal on its optimal office: The COVID-19 pandemic, and the question of whether or not in-office collaboration would ever be the same.  

Facing an Uncertain In-Office Future, Perspectus Looked at Life Beyond the Pandemic

Just before the pandemic forced countless organizations into remote working setups, Allegro had negotiated a 10-year lease for Perspectus. With an exceptional lease opportunity just a couple signatures away, Perspectus had to consider the state of the world—few businesses remained in their offices, most met with clients via video calls, and no one knew how long the pandemic would last. 

Ultimately, Perspectus determined that the transaction Allegro had negotiated was very competitive and included deal terms and concessions that allowed them to make a decision that was best for their future post-pandemic growth and in-office collaboration. Perspectus chose the Allegro-negotiated deal which included significant free rent and tenant improvements in their new, modern office space that would offset moving costs, while accommodating their growth and collaboration for the next decade. 

A Deal that Signaled Confidence in an Otherwise Uncertain Market

In March 2020, the Perspectus deal signaled that not everyone would forfeit office space for a move to a permanent work-from-home model. The transaction became one of the first deals in the market completed during the pandemic’s early days that clearly showed that companies were thinking about safe, collaborative spaces both during and after the pandemic.

But beyond sending a message of confidence, work began around the building. Perspectus’ landlord remained committed to making improvements to the building, including seeking a restaurant for the downstairs area as well as focusing on parking improvements to meet their needs. 

Perspectus’ new space has allowed them to continue their unique collaborative spirit to serve clients in a fresh, modern environment. 

“Allegro was great to work with. They showed us several spaces that met our needs and provided a qualitative and financial analysis to compare the shortlisted locations. We could not be more happy with our experience with Allegro.” — Michael Lipowski, Perspectus Managing Principal 

With a new office space primed for a growing headcount and uptick in clients, Perspectus was able to expand and encourage their team back to the office once the shutdown ended, paving the way for consistent, calculated growth well beyond the pandemic. 

Do any aspects of this situation sound like something you’re facing? We can help. Contact us to discuss your real estate needs today.