If you are just starting out in commercial real estate investing, you will surely find this collections of tips helpful. The following paragraphs include such a collection and will enable the enthusiastic beginner to grow into a pro in commercial property dealings.
Regardless of whether or not you are the seller or the buyer, negotiate! Protect your interests by standing up for yourself regardless of who is on the other side of the table. Negotiate a fair price rather than accepting one that is too high or too low.
To prepare for any sizable investment in commercial real estate, investigate indicators of fiscal health around the property in question, such as average income levels for nearby residents, rates of employment and unemployment, and whether jobs in the area are rising or falling. If you’re looking at a property that’s close to things like a university, employment centers, or a hospital, they’re likely to sell fast, and at a high value.
Use a digital camera to document the conditions. Make sure the picture shows the defects (such as spots on the carpet, holes on the wall or discoloration on the sink or bathtub).
There is much more time and work involved in purchasing a commercial property rather than a residential property. Remember that the time and efforts you are investing will pay off.
Get the credentials of any person who will be doing an inspection on a property you are trying to buy. There are many non-accredited people who work in such fields as insect removal. By hiring an experienced professional, you’re less likely to run into problems after you buy the property.
If you want to rent your commercial property, well built solid buildings are your best bet. Tenants are more likely to move in when they know the property is well taken care of. Such buildings also usually need fewer repairs, which is an advantage for the tenants, as well as the landlord.
Ensure there is adequate access to utilities on the commercial property. Your business is sure to have unique utility requirements, but services typically required by most include sewage, water, power, telecommunications and maybe even natural gas.
Go on some tours of places you might want to buy. Think about asking a contractor to assist you in evaluating each of the properties, since they will likely see things that you may miss. Once that is done, you can submit your proposal and begin negotiations. Prior to making any final decision, you should thoroughly go over the counteroffers you have received.
Make a checklist to compare details when looking at several properties. Collect responses from everyone that offers one, but inform the property owners before you do anything else. Don’t hesitate to let it be known that you are entertaining other options. This may help you snag a better deal, ultimately.
There are real estate brokers who deal exclusively with commercial investments. Some agents represent tenants only, while brokers work alongside tenants and landlords alike. You may be helped much more with a broker who just works with the tenant, as that person most likely has more experience in handling tenants successfully.
If you are taking out a commercial loan, you must pay for the appraisal yourself. There is a good chance that the bank may not validate it otherwise. Cover your bases and order the appraisal yourself.
As a new investor you should focus on one area of investment only. Pick a property type you desire to initially start with and focus on it with your undivided attention. It is better to do your best at one type than to be average at many types.
Hopefully, this article has provided you with a good base of knowledge upon which to build your successful endeavor in the commercial real estate market. This collection of tips can help you better your selling or buying technique in commercial real estate.