Lulu's Strategic Office Relocation and Cost Reduction
Introduction
Lulu, a leading online publisher, needed a new real estate strategy as their lease in Raleigh, NC was expiring. They sought a long-term plan accommodating both office and remote work during the height of the COVID-19 pandemic. Their current location, slated for conversion to lab space, no longer aligned with their modern workplace vision. Lulu also aimed to reduce their annual occupancy cost of over $520,000.
Challenge
Lulu needed to develop a long-term real estate strategy during the pandemic, decrease occupancy costs, and find a new office space that provided a collaborative environment with safe social distancing and work flexibility.
Solution
We proposed reducing office space to 15,000 square feet for Lulu's 75 employees. Leveraging the pandemic's impact on real estate, we negotiated favorable terms in a tenant's market. After evaluating options, we secured a five-year sublease at the Boxyard campus, reducing Lulu's annual real estate costs by 37%. The new Class-A space came fully furnished, eliminating additional capital expenses. The lease, starting November 2020, included six months of free rent, providing Lulu with a cost-effective, modern workplace solution.
