Owning commercial real estate has huge profit potential and might lead you to wealth. But, considering the risk involved, it obviously is not suitable for everyone.
Before you buy or sell a commercial property, find out several key economic indicators for the region, including trends in unemployment and income, as well as major employers in the region. If the building is near certain specific buildings, including hospitals, universities, or large companies, you might be able to sell it faster and for more money.
Buying commercial properties requires plenty of perseverance and calmness. Do not be hasty about making a investment decision. If the property doesn’t suit you in the end, you may regret your hastiness. Some investors have to wait for a year or so before they find the right opportunity.
When dealing with commercial properties location is everything. Take the neighborhood of the property into consideration. You will also want to calculate growth expectations by comparing similar neighborhoods. You want to know that the community will still be decent and growing a decade from now.
When choosing a broker, investigate their years of actual commercial market experience. Choose one that specializes in your area of interest. You need to get into a type of exclusive agreement with your broker.
Have a professional inspector look at your property before selling it. If they do find anything amiss, get it fixed immediately.
Take a tour of a property you might purchase. Consider going with a contractor when you are looking at places you want to buy. Use what you see in these tours to determine a fair opening offer. Before making any commitment, you should carefully evaluate each offer and counteroffer.
When viewing multiple properties, be sure to get a checklist from the tour site. Don’t go any further than 1st round proposal responses, unless you let the owners of the property know. It will likely be to your advantage to informally mention that you are looking at more than one property. It could even get you a good deal.
Have a list of goals on hand before you start searching for commercial real estate properties. You should write a list of which features are most important to you. For example, do you need a specific number of restrooms, a specific amount of square footage, or a conference room?
It is important to know how to deal with emergency maintenance. Speak with your landlord, and ask who is in charge of emergency repair work at your home 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. Use the information from your landlord to prepare an emergency plan to protect your reputation and customer service for the times when your normal business flow is disrupted.
Dual Agency
Read the disclosures when you’re ready to hire a real estate agent. Never neglect the fact that you may be dealing with a “dual agency.” Dual agency in real estate is when the agency works for both parties. 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. If there is a dual agency, everyone should be honest about it and find an agreement.
An investment in commercial real estate may earn you a sizable return. You need to not only front a substantial down payment, but have the time and patience to see your investment through to the end, as well. Follow these tips to help you succeed.