Start with one test. How sure are you that you will stay in the same micro market for the next 7 to 10 years. Very sure means consider buying. Not sure means lease and keep cash and flexibility.

10 Minute Test to Check which one suits you

WhatsApp Us to Get Access to Our Free Tool

When buying makes sense

Stable business and sticky location. Manufacturing HQs, pharma and QC labs, captive centers, family firms consolidating assets, and brands building a flagship HQ often gain from ownership. Control matters and the address is long term.

Surplus cash with few better uses. If after tax returns in the core business are easing, putting some capital into an owned office can work. This holds only if expected appreciation plus tax shields clear your hurdle rate.

Control and permanence. You can upgrade MEP, security, labs, and facade branding without landlord limits. Interiors you would leave behind in a lease sit inside your own asset.

Inflation hedge and stronger balance sheet. Commercial property can track inflation over long periods and signals stability to clients, lenders, and talent.

When leasing wins

Agility first. High growth tech and services, consulting, and project based teams value quick moves. Leasing lets you expand, contract, or relocate with less friction than buying or selling strata.

Capital efficiency. In many Grade A micro markets the effective rent is below your after tax cost of capital once you add fit out amortization, CAM, taxes, and opportunity cost. The math tilts to lease.

Speed to value. Warm shells, managed and coworking options get you live in weeks rather than quarters. Time saved boosts sales and hiring.

Easier exit. Leaving after lock in is simpler than running a sale process for owned space.

Finance lens

• Buy if interest or opportunity cost plus taxes and upkeep minus tax shields and reasonable appreciation is lower than your net effective rent.
• Lease if the rental yield in your market is lower than your after tax cost of capital and you want optionality.

Interiors as a swing factor

Fit outs cost a lot and resale is weak. Match fit out payback to the lease lock in

For example 3 to 5 years. Build modular where possible. Separate movable items like workstations and pods from site built spends. If you own, the walk away loss mostly disappears. Still avoid overbuilding what you will not use.

A practical hybrid

Own a core HQ with boardroom, labs, and mission critical teams. Lease swing space for growth. You can also use built to suit leases where the landlord funds the box and you sign a long lease. Sale and leaseback can unlock capital without moving.

Bottom line

• Lease by default when growth is uncertain, capital is tight, or talent access may push you to new corridors.

• Buy when your use case is specialized and long term, your cash is ample, and real estate returns beat your next best use of funds after tax and after realism.

Quick checklist

• Hold period. Can you stay 7 to 10 years in one micro market
• Growth volatility. Headcount swing plus or minus 30 percent in 24 months means lease
• Cost of capital vs rent. If rental yield is lower than your after tax cost of capital choose lease
• Cash priority. If buying will slow product, sales, or hiring choose lease
• Fit out payback vs lock in. Payback should be less than or equal to lock in. Use modular and movable interiors
• Tax view. Confirm GST and ITC eligibility, depreciation, and interest deductibility with your CA
• CAM and opex. Model CAM, utilities, insurance, and major repairs. Owners bear more
• Expansion options. In leases, negotiate right of first refusal on adjacent space and cap escalations
• Exit friction. Leasing exits are simpler. Owned strata may need time to sell
• Hybrid play. Own the HQ core and lease surge space
• Micro market reality. Check vacancy, pipeline, transit, and talent catchment
• Decision memo. Record assumptions and base, optimistic, and conservative cases. If buy only wins in the optimistic case choose lease

Own your identity. Lease your uncertainty.

Aakash Jain

Director