Purchasing commercial real estate is vastly different from purchasing a residential property. Read on for a few suggestions and tips that could help you get a great deal.
Negotiate, whether you’re the seller or the buyer. Make sure you have a voice and that you are offered a reasonable amount of money for the property.
Before purchasing any property, you should investigate its area to determine the average income level, unemployment rate and whether or not that area is growing. If your house is near a hospital, university or other large employment centers, they will usually sell quicker and also, at a higher value.
Calm and patience are both sound practices when you are searching for commercial property. Don’t invest in a hurry. If you buy a property that doesn’t meet your needs, you’ll sorely regret it. Realistically, it can take upwards of a year to find the right investment in your local market.
Consider visiting websites that contain a wealth of information beneficial to new and seasoned commercial real estate investors alike. No one can ever honestly claim that they know too much.
Commercial property is an investment. This investment is not just money, but also time. Not only will you have to search out the right property, you’ll likely have to make repairs or renovations to it after the purchase. Do not give up because this process takes too much of your time. Later, you’ll be rewarded for the time and money you have invested.
When choosing between two similar commercial properties, think large scale. Finding adequate financing on a piece of property takes time and patience. By choosing a larger piece of commercial property, you will be getting a better rate per unit, giving you the best potential for success.
Check out where the utility hook-ups are on any commercial property. Your business may have unique utility needs, but at the very least, you probably require hookups for electric, sewer, water and most likely, gas.
Before negotiating a lease with a commercial tenant, work on narrowing down the list of things that would constitute default. If you are able to successfully do this, you’ll find that your probability of having the tenant within the building defaulting will be low. A default is frustrating and costly.
Have an understanding on what exactly it is you are looking for when it comes to commercial real estate. List the qualities that concern you most in a property (e.g. restroom facilities, conference facilities, number of units available, square footage, etc.)
Dual Agency
Read the disclosures when you’re ready to hire a real estate agent. Dual agency is a possibility that you need to be aware of. Dual agency is when a real estate agency is responsible for the representation of both parties involved in a transaction. This means the real estate agency will work as the landlord and the tenant. Whenever dual agency is part of a transaction, it must be disclosed to both parties of the transaction. Both sides must also agree to the dual agency.
As you have read, there is much to ponder, when evaluating commercial real estate. Hopefully after reading this article, you have learned everything you need to know about commercial real estate.