Finding commercial real estate is a process, and it requires plenty of business smarts to find good, affordable spaces. But how do you determine what commercial real estate is going to be the best for your business? What is the difference between a great deal and financial losses waiting to happen? Here are a few tips to help you thoroughly evaluate your commercial real estate options, as suggested in the article, 7 Steps to a Hot Commercial Real Estate Deal:
#1 Have a Plan
Have some criteria for a space in mind and an idea of what you are willing to put forth before you even begin looking. Consider the following issues:
- How much space your business will need
- The kind of space you will need and any specific amenities that must be included
- The amount that your business can budget to pay for a space
- Whether you need to find other businesses to share a space with
Be ready to walk away from negotiations of a space does not meet your requirements.
#2 Learn How to Evaluate Like an Insider
In order to really navigate the world of commercial real estate, you need to learn what the professional real estate hunters know. A lot of people are not aware of the differences between leasing a commercial space and leasing a residential space. For instance, commercial property involves a bigger cash flow and the income on a space corresponds directly to its usable square footage. The lease terms for commercial real estate spaces also tend to be longer than those of residential leases. Finally, you need to know that commercial property lenders typically want you to be able pay at least a 30% deposit upfront, so plan for that when you are making your budget.
Preparing for your foray into commercial real estate is just as important as being a tough negotiator!