There typically is far more profit to be made in buying commercial real estate than there is in home purchases. Finding good opportunities isn't easy. Here are some suggestions on how you can make the most sense pertaining to the different variables so you may make wise choices in dealing with commercial properties.
Develop the perception that you are an expert by beginning an online blog. This can, in turn, increase the exposure of the property you are selling or leasing.
Always ask how a broker negotiates, before hiring him or her. Discuss each potential broker's experience and relevant education with him before hiring a broker. You want to ensure that the broker has good ethics, and is capable of obtaining the best deals possible. A quality broker will be happy to share examples of their past work with you if you ask, including both deals that were successful and those that weren't.
You should take into account any potential environmental concerns. A major area of concern would arise if the property has a history of hazardous waste generation or disposal issues. Once you purchase a commercial property, hazardous wastes and environmental issues become your problem.
Think about long-term economic conditions before investing in real estate. Be prepared for large-scale inflation during the next couple of years. The days when leases used regular adjustments to protect you against inflation are over. However, this is no longer common practice, which strips away one form of protection.
When purchasing commercial real estate, always keep your goals in mind. Do you want to start your own business there or do you want to lease the space? It will help you more easily find an appropriate piece of property to purchase if you know exactly what you plan to do with the property after you acquire it.
When you write your letters of intent, start off by dealing with the larger issues, then move on to the smaller ones later. By focusing on the big stuff first, you will have more pleasant negotiations, and you will be better able to manage small matters in the end.
For example, you might consider distributing a monthly newsletter or maintaining an online presence on the major social networking sites. Do not fade away in the online world once you have completed a deal.
Think about using feng shui to enhance your commercial properties and business. De-cluttering and open spaces are two key tenets, both of which are attractive to buyers.
Before you move into your new space, it may need to be improved. In some cases, all that is required are simple changes like moving the furniture around or giving the walls a new coat of paint. Oftentimes, moving walls and other fixtures is required to redistribute the floorplan. The contract you negotiate should clearly spell out whether you or your landlord will pay for these changes, or whether the cost will be shared and in what proportions.
Think bigger when you are investing in commercial properties. If you want to get a building that has five units, you need to know that's it's no different to manage than 50. You'll have to take out the same loan regardless of the number of units in the building, so buying a bigger building makes good financial sense. The larger the building, the less the cost per unit. For example, if you have to take out a $50,000 loan, you're paying $5,000 per unit if there are only 10 units in the building. If there are 100 units in the building, however, you'll only pay $500 per unit.
If you are just starting out as an investor, you would be well-advised to work on just one investment deal at a time. Pick one type of property, at first, and pay close attention to it. It's better to be very good at one particular type of real estate than to be okay at a lot of different types.
As the article you have just read illustrates, success in the commercial real estate market is indeed possible with the right knowledge and assistance. To succeed, however, you need to know what you are doing, as well as being a bit lucky. Not everyone will have success, but you can greatly improve your own chances of success by following the advice from this article.
Develop the perception that you are an expert by beginning an online blog. This can, in turn, increase the exposure of the property you are selling or leasing.
Always ask how a broker negotiates, before hiring him or her. Discuss each potential broker's experience and relevant education with him before hiring a broker. You want to ensure that the broker has good ethics, and is capable of obtaining the best deals possible. A quality broker will be happy to share examples of their past work with you if you ask, including both deals that were successful and those that weren't.
You should take into account any potential environmental concerns. A major area of concern would arise if the property has a history of hazardous waste generation or disposal issues. Once you purchase a commercial property, hazardous wastes and environmental issues become your problem.
Think about long-term economic conditions before investing in real estate. Be prepared for large-scale inflation during the next couple of years. The days when leases used regular adjustments to protect you against inflation are over. However, this is no longer common practice, which strips away one form of protection.
When purchasing commercial real estate, always keep your goals in mind. Do you want to start your own business there or do you want to lease the space? It will help you more easily find an appropriate piece of property to purchase if you know exactly what you plan to do with the property after you acquire it.
When you write your letters of intent, start off by dealing with the larger issues, then move on to the smaller ones later. By focusing on the big stuff first, you will have more pleasant negotiations, and you will be better able to manage small matters in the end.
For example, you might consider distributing a monthly newsletter or maintaining an online presence on the major social networking sites. Do not fade away in the online world once you have completed a deal.
Think about using feng shui to enhance your commercial properties and business. De-cluttering and open spaces are two key tenets, both of which are attractive to buyers.
Before you move into your new space, it may need to be improved. In some cases, all that is required are simple changes like moving the furniture around or giving the walls a new coat of paint. Oftentimes, moving walls and other fixtures is required to redistribute the floorplan. The contract you negotiate should clearly spell out whether you or your landlord will pay for these changes, or whether the cost will be shared and in what proportions.
Think bigger when you are investing in commercial properties. If you want to get a building that has five units, you need to know that's it's no different to manage than 50. You'll have to take out the same loan regardless of the number of units in the building, so buying a bigger building makes good financial sense. The larger the building, the less the cost per unit. For example, if you have to take out a $50,000 loan, you're paying $5,000 per unit if there are only 10 units in the building. If there are 100 units in the building, however, you'll only pay $500 per unit.
If you are just starting out as an investor, you would be well-advised to work on just one investment deal at a time. Pick one type of property, at first, and pay close attention to it. It's better to be very good at one particular type of real estate than to be okay at a lot of different types.
As the article you have just read illustrates, success in the commercial real estate market is indeed possible with the right knowledge and assistance. To succeed, however, you need to know what you are doing, as well as being a bit lucky. Not everyone will have success, but you can greatly improve your own chances of success by following the advice from this article.
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