Here are the issues.

Landlords prefer longer leases. Building owners have loans that they're frequently refinancing.  An important factor that a lender looks for is constancy in the tenant list. The longer the leases in the building the better the loan terms a Landlord can generally negotiate.  Landlords for the most part require a 3 year minimum term and often times are requesting a 5 to 7 year term. It's unusual to find a 1-or 2 year lease unless it is a sublease.  Most leases range from 5 to 10 years.

The duration of the lease you end up with can have a big influence on your business.  This is because an office lease is generally the second largest expense a company has after payroll.  If you are a seasoned company and you don't intend to bring on more employees, execute a long term lease.  There are many benefits to doing so.  

If you foresee the company growing then negotiate expansion options or a termination option or lease space in a building that will agree to a short term transaction.  Bear in mind however that on the shorter term deals, you are less likely to get a major build out as part of the deal.  Explore sublease options.

As an office tenant, you have to understand where you're company is headed and plan for the future.  If you're signing a 5 or a 10 year lease, you want to anticipate expansion and possible contraction and negotiate options to safeguard your future needs.

In the end, these questions are difficult to answer.  There's no one right answer, but you need to think about where your company is headed.

Nothing contained herein is to be considered legal advice. Always seek legal advice when evaluating any legal document.  

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