The thought of getting involved in commercial real estate can be daunting and even a little frightening, but it doesn’t have to be. You need to have a basic knowledge base in place before you start to do anything involving investing in actual property. The information and tips from this article are offered in the hopes that they can help you gain success in the real estate market.
Use your digital camera to take pictures of the property. Ensure that the photos document any problems, including mold, damaged walls, or chipped fixtures.
When choosing a broker, ask about their experience specifically in the commercial real estate market. Verify they have experience in working with the type of properties you are interested in. You need to get into a type of exclusive agreement with your broker.
Take digital photographs of the unit. Make sure the picture shows the defects (such as spots on the carpet, holes on the wall or discoloration on the sink or bathtub).
You should learn how to calculate the (NOI) Net Operating Income of your commercial property. To be a success, you need to be able to stay on the positive number side.
If you rent out your commercial properties, always remember to keep them occupied. Maintenance and upkeep costs for commercial property can be substantial and rental income is essential for paying those costs. If you have multiple properties available, you need to figure out what the reason is behind this, and address anything that is causing tenants to look elsewhere.
Make sure you’ll be able to access power, water and other utilities for your commercial property. Your business has its own utility needs, but you are most likely going to need water, sewer, electric and possibly even gas.
Don’t be led by hype and fads when searching for commercial real estate. Don’t rush to make an investment. A poorly thought out investment might soon give you many regrets. It could take some months, possibly a year, for your dream investment to appear in the market.
Plan on doing some improvements to your new commercial space before you can inhabit it. It could be as simple as a coat of paint or replacing some carpet. Many times, changes include reconfiguring the floor plan by moving walls. Negotiate payment for these improvements ahead of time, and attempt to have the landlord pay at least part of the costs.
Read the fine print about your real estate agent. Remember that dual agency is also an option. In this situation, the agent will represent the buyer and seller. This means the real estate agency will work as the landlord and the tenant. If there is a dual agency, everyone should be honest about it and find an agreement.
If you are hesitating between different properties, buy the larger of the two. Getting the financing you need is going to be complicated whether you choose a five-unit building or a fifty-unit building. This is generally like buying something in bulk, the more you buy, the less it is is per unit.
Look for an agency that keeps your best interest in mind. Otherwise, you could be in for additional money later on due to their mistakes which could have been avoided in the first place.
As mentioned earlier in this article, you are going to need a good bit of information at your disposal prior to entering any commercial property deal. This article should have given you the direction you need to search for new real estate.