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. But of course, we all know that the potential rewards can be considerable.
Why Must a Business Buy Real Estate?
According to experts, buying commercial real estate offers more control over the the real estate part of overhead costs, in contrast to leasing, where you may end up with higher rental costs as the lease rolls over at a time when the market is tight. The second benefit is gaining investment benefits – for example, property depreciation for tax-related purposes and, in time, appreciation of assets.
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 have to be within close proximity to your suppliers, employees, and most importantly, your customers. 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. 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. 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.
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 purchasing commercial property, determine whether or not you can lease out extra space, just in case your growth predictions fall short.
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