Buying commercial real estate is nothing like buying personal real estate. Read on for a few suggestions and tips that could help you get a great deal.
Regardless of whether you are buying or selling the property, it is in your best interest to negotiate. Be heard and fight to get a fair property price.
Engaging in a commercial transaction often takes more time, and is more difficult than simply buying a home. However, all of this is required because it facilitates higher returns on your investments.
Double-check that you are seeking a realistic amount of money for your property. There are many things that can impact your value greatly.
Make sure that the commercial real estate you want to purchase is equipped with connections to all of the utilities you’ll need. Look for access to water, electricity, gas an a sewer or anything specific to what you intend to use this property for.
When considering a piece of property, you must pay close attention to the surrounding area. In general, it’s better to locate a business in a richer area because rich customers obviously have more discretionary income. You might want to buy a property in a less affluent neighborhood if you are selling products or services that less affluent people would find attractive.
Lower the risk of default by eliminating as many things that can be labeled “event of default” as you can prior to negotiating a commercial property lease. This decreases the chances that the tenant will default on the lease. A default is frustrating and costly.
Pay for professional inspections of your commercial property before you put it on the market. This way you can make sure it is prepared in advance of a sale, and if any problems arise during the inspection you can take care of it on the front end.
You should advertise your commercial property as being for sale to people locally and those who are not local. Many sellers mistakenly presume that their property will appeal only to local buyers. A lot of investors buy property that is not where they want it if it is a good enough price.
Always include emergency maintenance on your list of need to know things. Find out from your landlord who to contact for emergency repairs, such as plumbing accidents. Keep a list of phone numbers close to you, and make sure you select companies that answer quickly. Consider how an emergency will affect your business operations, and have an emergency operating plan in place.
Commercial real estate agents specialize in working with different types of clients. Full service brokers work with both landlords and tenants and there are agents representing tenants only. If you intend to rent rather than buy, retaining the services of the latter type of broker may benefit you, as tenant-only brokers know what works when representing tenants.
By now, you realize that there are many things that need due consideration if you’re going on a commercial real estate shopping spree. Use the ideas in this article to inform you as to how to approach your next commercial real estate purchase.