Leasing keeps cash free and keeps you flexible; buying builds an asset and fixes your occupancy cost. For most growing companies leasing wins early, and buying an office only makes sense once your space needs are stable and you have capital you would rather tie up in property than in the business.
The core trade-off
Lease vs buy
Upfront cash — Lease: low (deposit) · Buy: high (deposit + costs)
Flexibility — Lease: high · Buy: low
Cost certainty — Lease: reviews/uplifts · Buy: fixed once financed
Balance sheet — Lease: liability · Buy: asset (with debt)
Upside — Lease: none · Buy: capital growth + you can sublet
When leasing wins
- You are growing or your headcount is uncertain - you may outgrow the space.
- You want capital working in the business, not locked in a building.
- You want to be in a prime location you could not afford to buy.
- You value the option to move, upsize or downsize.
When buying makes sense
- Your space requirement is stable and predictable for 10+ years.
- You have capital and want a fixed, inflation-hedged occupancy cost.
- Owning and controlling the asset matters strategically (you can later release capital through a sale-and-leaseback).
A simple test: if you cannot confidently predict your space needs a decade out, lease. Property is illiquid - the flexibility of a lease is usually worth more to a growing company than the asset upside of ownership.
