Consider your options and decide on the type of commercial real estate you want to procure. If you invest carelessly, you could be far into the red before you know it. Read on to learn how to make better commercial real estate investment decisions.
You should negotiate if you are the seller or the buyer. Fight for the best price possible and make sure that all parties involved listen to you.
Use a digital camera to take pictures. Include all the defects in the photo, such as carpet stains, or holes in the walls.
As with other property purchases, pay attention to the three Ls: location, location, and location. You will want to consider many things, including the neighborhood that the property is located in. Also, consider local growth projections. You need to be sure that in five to ten years later, the area will still be growing.
When deciding between two viable commercial properties, it is best to think on a larger scale. Finding adequate financing on a piece of property takes time and patience. In effect, this is similar to an economy of scale, or also like purchasing more of an item to save money.
If you rent or lease the commercial properties you own, keep them occupied as much as possible. If there is still open space, it will be incumbent upon you to pay for maintenance. If you have multiple unoccupied properties, try to determine the reasons why, and rectify the problems that are keeping tenants from renting the spaces.
Make sure that the commercial real estate you want to purchase is equipped with connections to all of the utilities you’ll need. You will need access to electricity, water, sewer and maybe gas in addition to any unique need that your business has.
Before you negotiate a commercial real estate lease, you should aim to decrease the things that could be considered an event of default as much as you possibly can. If you cover all the applicable issues, then you make it far less likely that potential tenants will default on their lease. That is not a situation you would want to encounter.
Do a walk-through and close evaluation of each property you are considering. It may be a good idea to take a professional contractor with you when you check out properties you are interested in purchasing. Make the preliminary proposals, and open the negotiating table. Don’t decide on anything without careful consideration.
You should always know how to get in touch with emergency maintenance. Get a list of emergency maintenance contacts from your landlord. Always keep this important contact information at hand, including average turnaround times. Take advantage of this information to devise a contingency plan in order to prevent and respond to customer complaints resulting from maintenance issues.
Check any disclosures a potential real estate agent gives you carefully. Some agents work for a dual agency. In this case, the real estate agency represents both sides of the transaction. In effect, while you are paying the agency, they also work for the opposite side; if you are a prospective tenant, for example, the dual agency represents the landlord, as well. Dual-agency situations require disclosure and the agreement of both parties.
If you are new to commercial real estate investing, you should learn how to manage one investment type at a time. Find one property type to focus on and devote your undivided attention to it. It is far better to dominate one area of the commercial real estate market than to spread your investing order many different types of commercial buildings.
The environment of your property is an important factor. You are responsible for cleaning up your building from environmental waste. For example, do you want to buy a property that lies in a flood zone? Reconsider the wisdom of that plan. There are things you can do, like contact the environmental assessment agencies, so that you can gain insight knowledge about the area you plan on investing into.
It is definitely possible to have significant success when investing in commercial properties. To succeed, however, you need to know what you are doing, as well as being a bit lucky. Not everyone will be a success, but using the tips above, you can improve your chances at being successful.