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.
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. Still, on the other hand, we are all aware that the possible rewards can be huge.
Why Must a Business 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 several factors to look into when choosing a commercial real estate property to purchase. 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 important issues to take into account:
The most significant issue is still the location of the property. You need to be as close as possible to your clients, workers, and suppliers. 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.
As soon as you have pinpointed a potential area, research about the property, its wear and tear, and any possible environmental issues it may be involved in, including whether there are potential liability issues, like lead paint or asbestos.
Serving Your Purpose
If you are a law firm, business office space is obviously what you need. As a manufacturer, you have to 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, 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
Make sure parking will be convenient for your customers, and access is compliant with laws like the Americans With Disabilities Act.
Leasing or Expansion Options
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.