Office condominiums work much like their private housing counterparts. Instead of renting a suite of offices, some companies purchase an individual unit in an office condominium complex. The common areas are co-owned by all of the tenants and a board usually oversees landscaping and other maintenance issues. Office condominiums are often created as part of a mixed-use renovation in downtown areas of medium to smaller cities.

There are some advantages and disadvantages to office condominiums. One plus is increased ownership rights compared to renting or leasing equivalent space. Rental properties are always under the control of a landlord, which means that monthly rent could be raised or the lease terminated with short notice to the tenant. By owning the space, companies in office condominiums can avoid such surprises. The monthly mortgage should remain relatively stable over the life of the loan.

Office condominiums are ideal for professionals and companies that can safely predict their permanent space needs. An architectural firm or small advertising agency might do well in office condominiums, but a fledgling manufacturing company could find future expansion nearly impossible. There may also be restrictions on the type of business which may be conducted in office condominiums. The facilities may not be able to accommodate excessive customer parking, for example.

One plus for those leasing office condominiums is the benefit of mixed-use buildings. It is not unusual for restaurants, specialty stores and other consumer outlets to share space with office condominiums. This means that employees of these offices don't have to travel far for entertainment and food. Mixed-use buildings with office condominiums tend to be located in downtown areas or other high-traffic business centers.

Surprisingly, the concept of office condominiums has not been embraced by many of the largest American cities. Instead, most are located in medium-sized cities such as Phoenix, Arizona and Portland, Oregon. The long-term return on investment for office condominium developers has proven to be a mixed bag.

During economic downturns, larger companies may invest in office condominiums in order to consolidate departments. Smaller companies may not see the benefits of condo ownership if their current rental or leasing arrangements appear beneficial. Office condominiums are often constructed on the 'If we build it, they will come' business model.