Savvy Tips for Entrepreneurs Looking to Invest in Commercial Real Estate

When you ask investors why they include real estate investments in their portfolio, they’ll probably give you the most popular answer,  which is that real estate is the most secure investment around. However, when you make an investment, you shouldn’t just consider if it’s secure, you should also consider whether you can get profits from it or not. After all, the whole point of making investments is growing your money. This is true especially if you intend to invest in commercial real estate, whether you intend to rent it out or use it yourself and start a business.  But how do you know if a piece of real estate is really worth your time and money? Well, here are some pointers that may be able to help:

house, home
Image source : freerangestock.com

 

Research Trends
In any endeavour, whether it’s an enterprise or an investment, it’s always best that you be in the know. Read up on current real estate prices, find out locations that are just starting to be developed, and discover which type of commercial properties are most lucrative at the moment. Essentially, check the overall climate of the real estate market. You can do all these by reading real estate blogs, listings and news.

Moreover, keep in mind that residential and commercial real estate have different values and so have different prices. So be sure that when you’re looking at properties, they really are commercial real estate. Take into consideration the locations of the properties as well. Different areas have different values. For instance, a property near a business processing zone will naturally be more valuable compared to a property found at the outskirts of the city centre.

Find the Right Help
Since you may not be able to know the inner workings of the real estate market, it would be wise that you seek the assistance of someone who does. Real estate agents will not only know the best properties around, they’ll also be able to help you out when you need to get business permits and licenses. They would also be able to help you negotiate prices with the seller. However, be careful who you choose. Make sure they have good credentials and relevant connections. Don’t forget to also ask for references as well. It’s important that you get some feedback about how he works and deals with clients.

Formulate a Business Plan
Having a rental property may sound like a hassle-free business, but you would be wrong. Just like any other business, it still needs ample planning as well as research. This may especially be necessary when it comes to your payment plan. Do you plan to pay the property all at once or would you prefer to do it in instalments? Are you planning to take out a loan for it? If you are, how do you plan to pay for that? Will you take it out from the income generated by the tenants’ rent or do you plan to get it from other avenues and leave that income untouched in the bank? These are serious considerations since they involve money.

Also, be perceptive. Learn to observe and gauge the attitude of the sellers when you deal with them. This will give you an idea if they are receptive to negotiating or not, and may help you get the best deal possible. Moreover, don’t be too excited or hasty. Any kind of investment is a big decision and should not be taken lightly. So before you decide on a property, collect several potentials that you can choose from. Then, carefully weigh their good and bad qualities. Make sure to factor in your future plans in your decisions as well. Also, don’t forget to consult your agent about your choices but don’t rely solely on their say so. Remember, it’s your investment and your money, so make sure that it will be your decision that you follow and nobody else’s.

Author Bio: Regus Philippines is a branch of the multinational company Regus, which is a provider of corporate solutions to all kinds of businesses worldwide. Among the products they offer are serviced offices, meeting rooms, business lounges, IT support and small business assistance packages. 

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