Handy Tips for Commercial Real Estate Buyers
A commercial real estate purchase is a complicated undertaking that is challenging even for professionals to time right to get maximum investment value.
It’s likewise a project abundant with risks, with the lows and highs in demand affecting everyone, from buyers to sellers to renters and all agents in between. But of course, we all know that the potential rewards can be considerable.
Reasons For a Business to Buy Real Estate
Experts believe a commercial real estate purchase gives more control over a business’ overhead costs, whereas with leasing, your rental costs may go up with the lease rolling over with at a time when the market is least profitable. Yet another advantage is investment benefits, which includes the depreciation of the property for purposes of taxation and, in the longer term, asset appreciation.
When buying business real estate properties, there are different factors that must be looked into. First of all, the traditional concept of “location, location, location” is perfectly applicable for business properties as it is for residential. Here are other important issues to take into account:
Where the property is located is still the main issue. You need to be as close as possible to your clients, workers, and suppliers. You have to be convenient to all who are part of your business, if you’d like them to remain. However, depending on the type of business you have, rail, highway and shipping lane access may prove important as well.
After determining a general location, check the property’s history in terms of wear and tear, environmental issues or possible liability issues (for example, the use of lead paint in older properties).
If you are a law firm, business office space is obviously what you need. If you are a product manufacturer, you should look for industrial space. Anyhow, make it a point to research about and learn zoning matters, ensuring that these will not get in the way of what you’re planning to do on the property.
Exterior and Interior Limitations
Now whether it’s because of building codes, zoning laws or covenants, there could be alterations that you are not allowed to do on the property. For instance, when buying a building in a historic area, you may have to follow rules when you want to modify the facade.
Parking and Access
Choose a property that offers parking convenience to customers, as well as compliant access for beneficiaries of laws such as the Americans With Disabilities Act.
Leasing or Expansion Options
Finally, with the typical positive growth outlook they have, entrepreneurs are likely to consider the possibility of expanding, as well as the total opposite of this scenario . When purchasing commercial property, determine whether or not you can lease out extra space, just in case your growth predictions fall short.