Which Commercial Property is Right For Me?
The decision to invest in commercial property could be the smartest financial move you ever make. But a lot depends on which property you choose to invest in, writes Dom Cassisi of Funding Options.
These tips can help you, especially if you’re looking to invest in commercial property for the first time.
Location is Everything
No matter how nice a property is, if it isn’t going to be noticed or easily accessed by customers, then it may not be a wise investment.
Take into consideration factors like:
– Other businesses nearby that will draw in customers
– Accessible parking
– Proximity to main routes and public transportation
Infrastructure and demand will influence the likelihood that people will notice the business. Do your research on the neighborhood and your potential market before snatching up a property.
Whatever you do, never simply guess at or estimate how much space you will need. Crunch some numbers before you start combing the commercial property market. That way, you can immediately rule out properties that don’t qualify and avoid the temptation to compromise.
How many rooms will be necessary? Is there sufficient work space for the employees? Will you get plenty of Internet coverage reaching all the areas it’s needed?
When checking out a potential property, find out how much of the space is actually usable. It could be less than it appears.
Comfort and Convenience
Depending on the nature of the business you’ll have on the property, you may have unique needs. Some very important factors to consider are:
– Security and alarm systems
– Space for workers to take a break
– Amount of natural lighting
– Air-conditioning and heating
– Location and number of emergency exits
– Parking, including disabled parking
– Views of the surrounding area
Local councils may have minimum requirements too, so make sure you do your research.
It doesn’t hurt to consider the option of going green. Making a few environmentally-friendly changes to the property could draw in more support for the business and even save on maintenance costs down the road.
Give yourself plenty of time to plan for fit-outs and renovations before renting out the property. You may even be able to get those projects done before the lease term starts.
Plan for Growth
Whether office, retail or industry, the business on your property must be dynamic. It’s not enough to just fit out your new property and expect it to generate income. You have to make an investment and then nurture it.
Calculate your estimated Return On Investment (ROI) from the moment you start planning. See if your budget will cover not only the purchase price, but also insurance, maintenance, fit-outs and operating costs. This is where it is crucial to seek advice from your financial adviser and experienced finance broker.
Before you can decide on a property, you must determine that it’s big enough to support any potential growth. Don’t just buy to start up a nice business now – buy to invest in the future. Keep in mind that the longer the lease is on a property, the more flexibility and room to grow it will have.
Before jumping in on the first commercial property that catches your eye, you need to carefully weigh the risks. While the returns on an investment like this can be lucrative, you risk losing a lot if the property is vacant for some time.
Get professional advice about financing your commercial investment property. The Funding Options team is ready to help you make the right decision on the best loan for you. Contact us now for a free, no obligations discussion about your needs.
– Dom Cassisi, Managing Director