Tips for Purchasing Business Real Estate
Purchasing commercial real estate is a convoluted venture that is tough even for the pros to time right to increase their investment value.
Also, it a project that is overflowing with risk, with agents, buyers and sellers, and renters alike having to bear the brunt of sudden increases or decreases in demand. Still, on the other hand, we are all aware that the possible rewards can be huge.
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. 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 several factors to look into when choosing a commercial real estate property to purchase. First of all, the traditional concept of “location, location, location” is perfectly applicable for business properties as it is for residential. Here are other essential considerations to be made:
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. At the same time, you may need access to rail, highway and shipping lanes, depending on the kind of business you are engaged in.
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).
Fitting the Purpose
If you are a law firm, business office space is obviously what you need. If you are into manufacturing, you require an 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.
Parking and Access
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.
Expansion or Leasing Opportunity
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 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.