How to Buy Your Company a Building.
Business is booming, payroll is expanding, and it’s finally time for you to become your company’s own landlord. Buying commercial property can be a wise investment for growing businesses that plan to grow even more, as well as for entrepreneurs looking to launch their brand new startups. There’s one caveat, though: It’s tricky!
Acquiring commercial real estate is a bit more complicated than finding a new house, thanks to the many additional rules and regulations that apply to commercial property. However, by asking the right questions and performing the right research, you’ll be well-equipped for the task at hand. Read below for tips and advice to help guide you to the perfect property for your business.
Know what you need.
When setting out to buy commercial real estate, it’s important to know exactly what kind of property your business requires. Zoning laws are the ultimate deciders of what you can and can’t do with a building. If you’re a business that sells retail with frequent face-to-face interactions with customers, you need a retail property. Landlords should seek Residential properties, software developers need an Office building, steel mills need Industrial, etc.
You should also be very particular about your location. The outskirts of town might be fine for an office space or factory, but retail locations and restaurants typically prefer to be near places high in foot traffic, like a busy downtown center or strip mall. It’s ideal if you can find a location that bolsters your business goals. At the least, ensure that it doesn’t hamper them. And don’t overlook parking!
Have a plan.
It’s crucial that you find a property that aligns with your long-term vision for your company. If you weren’t planning on continued growth, you wouldn’t be buying a business in the first place! Account for that by purchasing a building that allows for expansion or growth. If you see yourself needing a new building in the next 5-10 years, secure a building with a little extra real estate. Your future self will thank you for sparing them from another time-consuming building search.
Furthermore, if your purchase requires the aid of a government loan, you’ll be required to provide a detailed plan for the first year or two if you are a new business. Loan officers have a vested interest in making sure applicants can repay their loans, so you’ll need to outline projected revenue and expenses to show how you’ll meet the milestones and demonstrate the ability to repay the loan.
Hire a financial consultant.
Finding the right property can be a headache, but figuring out how to finance it will keep you up at night. Securing the finances needed to purchase a commercial property is a notoriously challenging process. Government loans provide exceptionally agreeable terms, however there is a process to getting your application completed timely and with as much detail as possible. This is why with the help of a consultant, the process can be completed much more efficiently and with minimal (if any) delays.