Investing in any sort of property is a pretty sound bet to make, but please don’t think that all forays into this market are born equal because they are not. So, if you have been approaching the possibility of investing in commercial property in the same way you would for residential housing then you need to stop, take a deep breath and start again. Why? Because the two are not the same.
There is much more you need to consider and that means there is more risk to contend with, from current events in global economics to what services your property offers. To help you out, we’ve pulled together a tick list of the most important things to think over before you commit your autograph to any dotted line.
1. Location, Location, Location
What is deemed to be successful on this front depends on what sort of commercial property you are buying. In residential properties, you look for nice neighborhoods, good schools and good transport links. With commercial, you need to consider the end user, and supplier, accessibility and connectivity; all of which are important to a business’ success.
2. Listen To The Law
When buying residentially, there are codes you need to meet and living standards you need to uphold, but they are nowhere near as stringent as with commercial investments. It is about meeting the Americans with Disabilities Act imposed on public buildings, which you can go to schemel-tarrillion.com to learn more about, and knowing what a building's allowable purposes are. Essentially, this means knowing a property’s lawful use before finalizing any deal, should it be with an office-based company or a manufacturer of goods.
3. Consider Support Services
There are a lot of support services you can offer that crossover with residential investments, such as supplier a gardener or a concierge or simply hiring a lettings agent. However, there are more to consider in commercial, many of which can affect the rent you receive and the resale value of your property. This is things like parking, security, elevators, service elevators and a plethora of other services. They affect the running of a business and they affect the price you command, so give them due thought.
4. The Clock Is Ticking
Having a timescale in mind is another thing that separates the two different types of property, Yes, in any and all investments, you will likely have a timescale of what you want to achieve financially by when, but this becomes a lot more flexible with commercial investments. That’s why you should be asking yourself certain questions: do you want an immediate return on your investment? Are you acting fast because of a local opportunity? Is this a one-off or are you planning on building a commercial portfolio? The more you can ask yourself, the more you will be able to determine the answers and that is what will encourage the right decision.
As you can see, there are some similarities between the two types of property investments, but the crossover is very tenuous. Residential is bought with the intention of renting it out to a specific demographic. That luxury is not granted with commercial properties.