Purchasing commercial real estate is a convoluted venture that is tough even for the pros to time right to increase their 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. Then again, we also understand that the prospective rewards can be substantial.
Reasons For a Business to Buy Real Estate
Professionals believe purchasing business real estate provides greater control over the the real estate portion of overhead expenses, versus leasing, which could raise your rental costs when the lease rolls over at a period when the market is hardly favorable. Yet another advantage is investment benefits, which includes the depreciation of the property for purposes of taxation and, in the longer term, asset appreciation.
There are various factors to look into for anyone planning to buy a certain commercial real estate property. First off, the age-old adage “location, location, location” couldn’t be truer for commercial properties as much as it is for homes. Here are other crucial points to consider:
Where the property is located is still the main issue. You’ll want to be as close to your customers, employees, and suppliers or vendors as possible. You should be convenient to all these people if they are to come to you. But depending on the nature of your business, you may need access to highway, rail, and shipping lanes too.
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).
Serving Your Purpose
If you are a financial services company, you clearly need commercial office space. As a manufacturer, you have to look for industrial space. In any case, make sure you do some research and learn about the area’s zoning requirements and that these will not pose problems with what you need to do on the property.
Exterior and Interior Limitations
Now, when planning to make any changes or alterations to the property, note that they will be subject to restrictions dictated by zoning laws, building codes or covenants. For example, if you buy a building in a historic area, there may be rules to follow when making changes to the facade.
Access and Parking
Make sure parking will be convenient for your customers, and access is compliant with laws like the Americans With Disabilities Act.
Expansion or Leasing Opportunity
Lastly, entrepreneurs are generally optimistic about growth, and this the possibility of an expansion will be considered, along with the flip side. When buying business property, know whether or not you will be able to lease out unused space, in the event that you fall short of your growth forecasts.