It is easier than it seems to be a success in commercial real estate. There are, however, a few things you need to know about a property before making any transaction. Continue reading to gain the information you need so you can move forward with a fully formed strategy which will lead to success.
Regardless of whether you are buying or selling, you should negotiate. Make sure that you are heard and that you fight for a fair price for the property.
Examine socioeconomic conditions in the neighborhood you’re thinking of purchasing commercial real estate in. Pay special attention to the unemployment rate, and the average income level in your property’s neighborhood. Properties near hospitals, universities or other centers of large numbers of employees tend to sell faster and at higher-than-average values.
Use your digital camera to take pictures of the property. 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.
Once you have narrowed your choices down to two major contenders, you should expand your decision to include the big picture. It’s just as difficult to obtain adequate financing for a 10 unit apartment complex as it is for a 20 unit building. Just think about it as the more you buy the lower you are paying per unit, so you save more in the end.
When you are picking a broker, make sure you know if they are experienced within the commercial real estate market. Make sure that they are experts in the area in which you are selling or buying. Once you’ve determined the broker is right for your needs, make sure any agreement into which you enter is an exclusive one.
If inspections are part of the deal on your real estate, be sure to check all the credentials of the hired inspectors. You should particularly watch for people involved in insect or pest control. There are a large number of individuals who work in these areas that do not hold the proper credentials. Ultimately, this can help you to bypass larger, more expensive problems.
With the commercial property, you need to make sure there is easy access to the utilities. 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.
Before negotiating a lease with a commercial tenant, work on narrowing down the list of things that would constitute default. So a tenant can’t default on a lease they sign with you in this type of situation. A default is frustrating and costly.
You need to advertise that your commercial property is for sale to both locally and non-local people. Don’t be mistaken by the thought that locals will be the only people interested in your sale. Many private investors are interested in cheap or affordable properties in other areas of the country or world.
Before making a commitment, you should request tours of any potential properties. Look into having a professional contractor accompany you as you take a look at the properties you’ve been thinking about purchasing. Make a proposal early, and get into the beginning stages of negotiation. Closely review any counteroffers you receive prior to making a final decision. Remember the decision is an important one, so take your time.
Commercial Real Estate
As stated earlier, you will need to prepare yourself extensively before pursuing commercial real estate. The sole purpose of this guide was to give you information that can grant you success when you invest in commercial real estate.