Buying a commercial property is totally different than buying a house, so don’t treat them as identical transactions. The article below details some tips you should keep in mind when shopping for commercial real estate.
Take plenty of pictures of the building. Your pictures should portray any damage or defect in the property. Common things you should look for include any cracks or holes in walls, and damages to the carpeting.
As with other property purchases, pay attention to the three Ls: location, location, and location. Consider the neighborhood of the property. Compare the growth of the property’s neighborhood to similar neighborhoods around the country. Make sure that the area will still be nice and growing in several years.
Negotiating is essential. Make your voice heard and strive for fair market value pricing.
Buying commercial real estate is much more complicated and time-consuming than buying a home. You need to understand, you have to be diligent in order to get a profit.
When interviewing potential brokers, ask them to tell you about their experience level with the type of commercial investments you are interested in. Make sure you know that they actually specialize within the area you plan on selling and buying. Once you find the broker you want to use, sign an exclusive agreement.
Learn to understand the commercial real estate metric called Net Operating Income (NOI). To be successful, you must stay profitable.
Prior to making a large investment on a property, look at the local income, unemployment rates, and contraction of the local employers. Properties that are near major employment centers, such as medical centers or universities, often sell more quickly and at a higher price.
If you intend on putting your commercial property on the rental market, find a simple, but solidly constructed building. These units draw in the best tenants because they are higher in quality and have nicer appearances. Buildings like these are also easier to maintain, for both owners and tenants, since repairs are going to be required less frequently.
As you might imagine, there are a multitude of considerations, when you are contemplating an investment in commercial real estate. Embrace this article’s advice to ease the process of finding your business’s future home.