I STARTED A FIRM, WHERE SHOULD I HANG MY SHINGLE?

By: Andy Brabender
Brabender & Chiang LLC

When an attorney is thinking of starting his or her own firm, one of the first and
most important decisions they have to make is the selection of an office. The choices
range from working at home to leasing a long-term commercial space and building it out.

This article aims to briefly discuss the most common options in the Chicago area and
outline the advantages and disadvantages of each.

WORK FROM HOME

Working from home is certainly the most cost effective office arrangement for a solo
attorney. Many solos, young and old, use the home office as their principal workspace.

A home office saves many traditional professional expenses in addition to the cost of the
office itself. Most notably, one can save hundreds of dollars each month by rendering a
commute unnecessary. A professional wardrobe is only needed for meetings and court.
Lunches will generally be cheaper as well, since the refrigerator is nearby. Avoiding
after-work drinks can also save money.

Aside from cost, working from home can save hours of commute time that is better spent
attending to personal needs, caring for children, completing client work and developing
your practice.

While working from home is the most cost conscious option, there are some important
disadvantages to keep in mind. The most important restriction is the lack of a meeting
space to see your clients. If you are not planning on practicing in an area where your
clients prefer to meet in their offices, working from a home office can be a challenge.

While you may be able to borrow a conference room from another solo attorney, a law
school, or rent an hourly room, these options can be problematic. Some attorneys meet
with their clients in coffee shops and other public spaces, but such meetings raise image
and confidentiality concerns.

Isolation can be a major concern for an attorney working from home. When you have a
fledgling practice most of your time should be spent networking and marketing. Your
efforts will be hampered if you never change out of your pajamas and leave your home.

A final concern is that working from home often results in many distractions and little
work being done. The loss of productivity can cost far more than renting an office space.

PROS:

  • Most cost effective
  • Eliminates commute
  • Usually improves the ability to meet family obligations
  • Pajamas are an option

CONS:

  • Difficult to meet clients
  • Reduces networking and marketing opportunities
  • Prone to distractions

VIRTUAL OFFICE

Virtual offices are a favorite of frugal solo attorneys just opening a practice. They
commonly offer about 10-20 hours a month of actual office or conference room time
(usually in 1 hour increments) as well as a mailing address, mail forwarding and a
receptionist to answer your calls. Virtual offices are mostly located in the Loop, though
they can also be found in some of the more populous suburbs.

Another perk to a virtual office is that some of the larger companies will allow you to use
any of their locations (for an additional fee). This can make your firm seem more
prominent and is also convenient for your clients. If you ever wondered why some two attorney firms list 15 office locations, this is what is going on.

A virtual office in downtown Chicago usually costs about $300 a month and the two most
well known companies that offer this service are Regus and Amata. Contracts are
typically offered either on a month-to-month basis or annually.

PROS:

  • Lowest cost (other than working from home)
  • Professional meeting location for clients
  • Potential for networking and referrals
  • Low capital required
  • Low commitment
  • Professional address

CONS:

  • High cost per-hour
  • Office is generally barren
  • Concerns about using more than allocated time
  • Only currently available in major cities and large suburbs

OFFICES IN A PROFESSIONALLY MANAGED SHARED SUITE

One step up from a virtual office is a full time office in a shared suite managed by a
professional company. This arrangement is becoming more popular and usually consists
of a company signing a lease for an entire floor of a building and dividing the area up into
individual offices. The management company then leases each office to a business,
typically on an annual lease (though month-to-month is available by some providers).

These offices provide nearly all the advantages of leasing your own suite without high
startup costs and long-term commitments. They are commonly used by firms that
outgrow their virtual office (often staying with the same company and location).

The quality and features of the shared suite vary from provider to provider. Some high end suites provide a receptionist, paralegals, furniture, copying facilities, a kitchen, an
ideal location and amazing view. On the other end of the spectrum, the most humble
facilities are in older buildings and provide only an empty office and usually a shared
conference room.

It is extremely important to determine what is and is not included in the price quoted by
the management company. Complaints of nickel and diming by management companies
are endless. Moreover, if you intend on using your mobile phone as your primary phone,
be sure you have reception in the office. Some suites are not wired for a hard-line phone
and others have very poor mobile reception.

The monthly rent in a professionally managed shared suite ranges from $2000 for a large
high-end office to as low as $400 for a small office in a more modest facility.

PROS:

  • Professionally managed
  • Wide range of quality and cost
  • Moderate commitment
  • Low overhead
  • Networking and referral opportunities
  • Wide range of services

CONS:

  • High potential for nickel and diming
  • Can be expensive per square foot
  • Often requires yearly commitment

RENTING FROM ANOTHER PROFESSIONAL

A new solution that is becoming more common is renting an empty office from an
established firm or other professional.

It’s hard to generalize this category of office sharing because the variation in price and
features is huge. Typically, all the features of a professionally managed suite may be
available plus the possible use of staff, multiple offices and availability of workstations.

One feature that does set these offices apart is that they often have practice-area
restrictions. Some firms do not want a competing firm in their office and others do not
want one who may be opposing counsel. It is possible to find a shared suite with a non-lawyer, but it often takes more legwork.

The best part about renting from another professional is that there are some really great
deals out there, especially if you find them yourself. The disadvantage is that the office is
not professionally managed and you are likely subject to the whims of the firm that leases
the suite.

The cost of an office in a shared suite is usually between $500-2000 a month in
downtown Chicago.

PROS:

  • Great deals exist
  • Opportunities for referrals and networking
  • Wide variety of options available

CONS:

  • Can be hard to find
  • Subject to idiosyncrasies of landlord
  • Possible conflict and confidentiality issues
  • Can be abruptly kicked out to make room for expansion of the landlord

YOUR OWN SUITE

The old-school route and that chosen by most well established firms is signing a long
term lease for an office, building out the suite and handling all the utilities and
accouterments in-house.

Clearly this is the least flexible route and the most capital intensive of them all. It does
give you near total control and may be cost effective if you have more than one attorney
or multiple staff, especially as compared to the high cost of multiple offices in a
professionally managed shared suite.

I have met only a few solo attorneys who signed long term leases, as the commitment and
capital costs tend to be too great, at least in Chicagoland.

PROS:

  • Can be the least expensive per square foot especially as a firm grows
  • Near total control

CONS:

  • Huge commitment
  • High capital requirements
  • Low flexibility
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