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Is your company relocating, downsizing, or developing a hybrid work environment?  The times we currently live in are “certainly uncertain”.  There has been a dramatic shift in businesses reconsidering their current office environments, what their spaces and needs are currently, and what they will look like in the future.  Many have concluded they do not need as much space as previously, or they need to reconfigure existing space to allow for social distancing and other safety measures to be implemented.

All of this has seen an explosion in the number of spaces being fully or partially decommissioned.  To add to the complications, many national companies are attempting to decommission spaces from locations hundreds or thousands of miles away from the local business site.  Before a business decides to decommission some or all its space, there are three things which every business must consider.

What Are You Required to Do?

Review Your Lease Contract and Its Specific Requirements

Some contracts only require the space be empty and “broom clean”.  Most contracts, however, require the space be restored to original condition.  This includes removal of items the business installed after the lease was signed such as HVAC, electrical, IT voice/data cabling, workstations, lighting, FFE (furniture, fixtures and equipment), signage, E-waste, hazardous waste and trash removal.

Contracts also can require cancellation of vendor services, touch up and repair of damage to walls, doors, floors, common areas, cafeterias, restrooms, etc.

What Will You Do with Unusable FFE?

To Liquidate or Not to Liquidate

Over the course of time FFE becomes worn and outdated.  Your contract, most likely, states that your business is not allowed to leave the items.  So, what do you do with unusable FFE?  For starters, your company’s economic, environmental, and social beliefs can provide initial guidance.  There are several options:

  • Hire a third-party wholesaler who purchases the furniture & equipment at a price to offset the dismantle by a professional furniture installation company.
  • Hire a professional furniture installation company to purchase the furniture & equipment at a discounted price to cover the cost of the dismantle.
  • Hire a professional installation company to dismantle the product and work with a third-party wholesaler to provide labor and logistics in lieu of purchasing the FFE, thereby reducing the cost to the owner.
  • Donate unwanted FFE to charities, recycle, or have a discount sale for employees or other socially appropriate options. 

What to Do with Usable FFE?

As mentioned previously, not all companies need or want to liquidate FFE.  Many companies are reconfiguring spaces to create a “hybrid environment” where employees share space on rotating days or allow a combination of in-office and work-from-home options. 

For accounting purposes, or perhaps a plan for full return to work in the future - where the FFE is in great condition, businesses are faced with short and long-term storage dilemmas.  The total cost to store FFE should be factored into the total cost of your decommission.  This is an opportunity to partner with a professional furniture installation company that offers furniture decommissioning, short and long-term storage, and reassembly as a turnkey solution, thereby providing a total cost and helping you avoid financial surprises.

Posted in: Industry Tips
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