Commercial real estate may make you wealthy. However, it’s not for everybody, the stakes are large and so is the investment.
Take some digital photos of your property. In the “before” photos, especially, make sure that the pictures clearly show defects such as stains on the carpet, discolorations in the tub and sink, and holes in the walls.
The location of the property is the most important factor to consider when investing in commercial real estate. Take the neighborhood of the property into consideration. Look at the growth in similar areas. You’ll want to choose an area that is on the upswing and will continue growing for at least a decade into the future.
Once you have narrowed your choices down to two major contenders, you should expand your decision to include the big picture. The difficulty in securing financing doesn’t increase linearly with the size of the building you are buying. This just reflects the general advantage of buying anything in bulk; when you buy a property with more units, you get a lower average price for each one.
Check out where the utility hook-ups are on any commercial property. The utilities you will need for your business go beyond electricity; you will also need water, sewer and gas, as well.
Be sure you position yourself well when it comes to negotiating any lease for commercial real estate, you want to do things like decrease what could be considered as a default event. Your tenant will be less likely to default on the lease if you do this. You don’t want tenants defaulting on your leases.
A letter of intent should be kept simple by focusing on larger issues and leaving smaller issues to negotiate later. This will make the negotiations faster and less tense, and it will also cause the lesser issues to be completed easier.
If you are checking out more than one property, draw up a checklist to compare the features of the different properties. Determine which properties initially make the cut, but once you do, let those property owners know. It will likely be to your advantage to informally mention that you are looking at more than one property. This may provide you with more room for negotiation.
Identify any necessary improvements before you sign on a new space. This may be simple changes such as painting or rearranging furniture. Many times, changes include reconfiguring the floor plan by moving walls. Plan on negotiations with the owner of the property to see if all, or part, of the costs can be covered by said owner.
It’s critical to have emergency maintenance contact information very accessible. You should ask your landlord who is in charge of handling emergency repairs. Have the phone numbers on speed dial, and know how long it generally takes stuff to get fixed. Use any advice you can gather from a landlord to protect your customers with properly configured emergency plans.
A person can make a big profit by getting involved in commercial real estate. This being said, it takes money to make money, so it is important to protect yourself and your investment by putting in your maximum effort to each and every deal. To accomplish this, it would be wise to use the advice in this article.