Starting your own business is a huge step in and of itself. Buying your first commercial property to house your business is an even bigger step! Let’s face it. Online competition is stiff these days and it’s only going to get more and more intense. You have to have a lot of ducks in a row before signing a lease or purchasing a property outright. We’re going to explore some ways in which you can prepare yourself for that next big step.
What kind of property/space do I need?
First thing’s first. You have to know which goal post you are going for in order to move in that direction successfully. Ask yourself, “What is the best space for my business and my customers?” Depending on your business, you will need vastly different amenities and features for your commercial space. Are your clients more likely going to be foot traffic or will they set up appointments and drive by car? What other businesses are around your space? For example, if you are a wedding cake baker, you may want to set up shop close to a wedding dress or equipment rental business. Put yourself in the mind of your customers and see if stopping by your place is convenient and helpful to them. Another good thing to keep in mind: Are directions easy to give to your business? If someone is referring your shop to a friend, is the location easily described and seen from the road? If not, then you may want to pass on that particular property.
It might also be a good idea to look at the area’s “vacancy rate” which is the percentage of vacant properties in a given area. This can help your business’s image in a very positive way if you are not always surrounded by empty lots or buildings.
Consult the experts
Getting ahold of a good commercial real estate agent and a trusted commercial real estate broker is always a good idea when you are preparing to take the commercial property plunge. They can help you with all of the technical and more complex aspects of purchasing a commercial property that the average person doesn’t know about. First, get your finances in order and make sure of what you can afford in monthly payments and down payments on your first property. You want to be an expert in your own income streams and be able to predict well into the future. If you haven’t already, start saving a nest egg for a down payment. The bigger the better. These experts can also help you stay within the law when it comes to zoning and building codes.
What condition is the property in?
While location is important, the property’s physical condition and age are also important. If you are buying a pre-existing building, then you may want to consult public records to see if there have been any major repairs, fires, or other physical alterations that may compromise the lifespan and usage of your building. Is the property close to a body of water like a stream or pond? These may flood or cause water damage. Consider inspecting for water or mold damage as well and see if there are any steps to prevent the water from coming in contact with your building and property. Finally, look at the building materials themselves. Some older buildings may be comprised of more flammable or have potentially toxic materials. You may be responsible for bringing them up to code or replacing them when the time comes. They could also increase your monthly utilities by being less energy efficient than modern materials.
There’s so much to consider when buying or leasing your first commercial property! Keep these things in mind and move forward with the best plan for your business.