Tips For All Your Commercial Real Estate Needs
The probability for gain in commercial real estate is generally higher than in residential real estate. Sometimes it can be difficult to find the best opportunities available. These tips will help you decipher the variables so that you make good real estate decisions.
Negotiating is essential. Make your voice heard and strive for fair market value pricing.
As with other property purchases, pay attention to the three Ls: location, location, and location. Consider how the neighborhood will affect business. Compare this neighborhood to the growth of other similar areas. Since you will likely still own the property in ten years, you want it to be located in an area that is likewise still desirable in ten years.
Bugs and rodents are always looking to ruin your property, so factor pest control into your business strategy when renting commercial property. This is especially important when an area is known to have pest and rodent problems. Prior to signing a lease, ask your agent what the current pest control policies are.
If you are trying to choose between two good commercial properties, think big. Regardless of whether the property you decide on has twenty units or fifty, the process of obtaining financing will be the same, and in both cases will require substantial effort. In effect, this is similar to an economy of scale, or also like purchasing more of an item to save money.
When you are looking at a commercial property, be sure to look at the neighborhood, too. If you purchase it in a more affluent neighborhood chances are your business will be more successful, because the pockets of your potential clientele are a bit deeper. Bargain-oriented goods and services will find a more receptive market in lower- to middle-class areas.
Make sure you'll be able to access power, water and other utilities for your commercial property. The property must have access to electric, water, sewer and maybe gas for it to be a viable commercial real estate purchase.
Before negotiating a lease with a commercial tenant, work on narrowing down the list of things that would constitute default. That will cut down on the likelihood that the tenant defaults on a lease. This is something you want to avoid.
Eliminate as many definitions of default (i.e., actions that constitute default) as possible before beginning to negotiate a lease with a new tenant. The tenant will then be less likely to violate these terms. This is something you want to avoid.
You must know how to deal with an emergency, should it arise. Talk to the landlord about who does emergency repairs for your building or office. It is important to keep these contact phone numbers handy and to have a good understanding of how long it will take for them to respond if needed. In case a maintenance emergency should happen, you can use the information provided to lay out an emergency business and customer service plan to save your company's reputation in case your business is interrupted.
Have property professionally inspected before you decide to put it up for sale. If they flag issues that need to be fixed, repair them before you list the property for sale.
Before you make a decision on which real estate broker to use, see how they negotiate. Much like you would interview a prospective employee, question their experience and training. You should also make sure that they use ethical methods and know how to get the best deals. Ask them to tell you about their past work, including their successes and mistakes.
Hopefully, this article has provided you with a good base of knowledge upon which to build your successful endeavor in the commercial real estate market. Keep these tips in mind and you hone your skills and become successful at both buying and selling commercial property.
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