Is Your Office Lease Dead Weight?
Why Remote Workers Are Replacing Commercial Space with Backyard ADUs
When an ADU Can Replace Your Office Space Lease
Remote work is a thing of the past? Not quite. While it’s true that many companies are bringing their employees back to the office, there is still a large percentage of professionals—especially freelancers, consultants, and tech workers—who continue to work remotely full-time or on a hybrid schedule.
For those people, paying for a co-working space or maintaining a commercial lease no longer makes financial sense. That’s where an Accessory Dwelling Unit (ADU) comes in. With the right design, an ADU can double as a professional-grade home office, giving you privacy, focus, and long-term savings.
Let’s crunch some numbers and see what we’re working with.
What is an Office ADU?
An ADU, or Accessory Dwelling Unit, is a small, independent residential structure located on the same lot as a single-family home. While most people think of ADUs as rental units or guest houses, they can also be customized for other uses—including as a fully functional home office.
An Office ADU is essentially a private workspace just steps away from your home. It can be as simple as a 300-square-foot studio with a desk and Wi-Fi, or as advanced as a multi-bedroom soundproofed office with a waiting room, murphy bed, and built-in storage.
Unlike a spare bedroom or a dining-table-turned-desk, an office ADU gives you a dedicated space to focus, meet with clients, and create a true work-life boundary. And because it’s a legal structure, it can also boost your property value and serve other purposes down the line.
Why not just build a guest house for an office?
A common misconception is that guest houses and ADUs are the same thing, but they’re actually quite different. Guest houses are intended for short-term living, so they often don’t come with a full kitchen.
ADUs, on the other hand, are built for long-term housing, so they are required to have a full kitchen with the necessary appliances, counter space, plumbing, and electrical wiring.
You may be asking, “Why would I need all that just for an office?” You probably don’t! A coffee station may suffice for your office, but we encourage our clients to look at the long-term use for your ADU. ADUs can be used for a wide array of purposes over time: a home office today, a rental unit tomorrow, or even a place for aging parents down the line.
By building a permitted ADU instead of an unpermitted “guest house,” you not only ensure compliance with local regulations, but you also open up far more flexibility, value, and income potential in the future. In other words, you’re not just building an office—you’re building an asset.
Cost Comparison: Office Space Lease vs ADU
Let’s break down what it actually costs to rent a dedicated office space versus building a small ADU that functions as your private office.
Scenario:
You’re a business consultant. You meet with clients regularly and need a quiet, professional setting—something more than just a laptop on your kitchen table. A 300 sq ft garage conversion ADU in your backyard could offer the privacy and polish you need, but is it worth the cost?
Option 1: Leasing Office Space
Just for example purposes, let’s say you lease a small private office in a coworking building near downtown San Diego.
5-Year Cost of Leasing Office Space: ~$120,000
Option 2: Building a 300 sq ft ADU Office
Now let’s look at converting your garage into a permitted ADU.
- Estimated Build Cost: $180,000 (San Diego average for a high-quality 300 sq ft conversion)
- Ongoing Costs: Minimal (utilities, cleaning, occasional maintenance)
- Commute: 30 seconds
- Perks: Full privacy, dual-purpose use (guest space, rental later), adds property value
If you finance the build with a 30-year loan at ~7% interest, your monthly cost could be around $1,200–$1,400, depending on your down payment. But unlike leasing, that money goes toward an asset you own—one that increases your property value and could generate rental income later.
5-Year Cost of an ADU Office (with financing): ~$84,000
Equity Built: ~$30,000+ (plus long-term appreciation)
Non-Financial Benefits of an ADU Office
While cost savings and long-term value are big motivators, many homeowners say the non-financial benefits of building an ADU office are what truly transform their work lives.
Zero Commute, All the Time
No traffic, no parking stress, no wasted hours. Your commute becomes a quick walk through the garden—giving you back time and mental energy every day.
Separation from the Main House
When your office is just a few feet from your back door—but not inside your living room—you get the best of both worlds. A physical boundary between “home” and “work” helps you stay focused during the day and truly unplug at night.
Customization & Comfort
You’re not limited by someone else’s design. Want built-in bookshelves? Natural light? A standing desk? A meditation nook? You can create a space that matches your workflow and reflects your style.
Multi-Use Potential
It can’t be said enough. Even if you’re using it as an office today, an ADU can easily be repurposed. It could become a rental for passive income, an art studio, or even housing for a loved one. Flexibility like this is rare—and powerful.
ADUs aren’t just for grandmas anymore. These small but mighty units have come a long way since they first crashed into the real estate scene, having evolved into versatile, high-performing spaces that meet the demands of modern life. They offer homeowners a smarter way to use their property and take control of their time, space, and future.
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Jon Grishpul is Co-CEO of www.MaxableSpace.com—the industry-leading ADU property design / build / construction resource website for home offices, granny flats, in-law suites, guest houses, casitas and other types of Accessory Dwelling Units. He is also Co-CEO of GreatBuildz.com—a FREE service that matches homeowners with reliable, pre-screened general contractors. He's also Co-CEO of He may be reached at www.MaxableSpace.com.
All images "Courtesy of www.MaxableSpace.com"