Handy Tips for Commercial Real Estate Buyers
Purchasing commercial real estate is a convoluted venture that is tough even for the pros to time right to increase their investment value.
As well, it’s a project replete with risk, as everyone involved in the picture – from buyers to sellers to agents to renters – can suffer the negative consequences of a drop or surge in demand. Then again, we also understand that the prospective rewards can be substantial.
Why Buy Business 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. The second benefit is gaining investment benefits – for example, property depreciation for tax-related purposes and, in time, appreciation of assets.
There are several factors to look into when choosing a commercial real estate property to purchase. One, that classic adage “location, location, location” is equally true for commercial real estate as it is for family homes. Here are other important issues to take into account:
The location of your property remains the biggest issue. You’ll want to be as close to your customers, employees, and suppliers or vendors as possible. You must be convenient to everyone involved in your business, if you want to keep them there. 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).
If you are a law firm, business office space is obviously what you need. If you are into manufacturing, you require an 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 Zoning laws, building codes or covenants may restrict certain changes or adjustments that you might be planning to make on the property. When modifying the facade of a building in a historic area, for instance, there may be specific guidelines to follow.
Access and Parking
You must ensure that your customers will be able to park conveniently and that access is compliant with the Americans With Disabilities Act and other similar laws.
Leasing or Expansion Options
Finally, entrepreneurs usually have a positive outlook about growth, and this only means that the likelihood of expanding is a consideration, as is the opposite. When purchasing business property, find out whether you have the option to lease any extra area, just in case business doesn’t work out as rosily as you have predicted.