Seven things to consider when buying business property
If you're going to build a business, you'll probably need real estate. Depending on what type of business you're developing, and what your goals are, that could be a storefront, an office, or even a warehouse
. Regardless of what type of property you're considering, there are some important considerations you'll need to bear in mind before you start looking for a place to set up shop.
10 Aug 2017 15:23 Main considerations for business property
Review these considerations, and understand them fully before proceeding with your research:
Starting your search
- Buying vs leasing. Your budget will play a significant factor in how much real estate you’re able to afford, as well as whether it’s advantageous to buy or lease the property. Each approach comes with pros and cons; for example, buying a business means you’ll get to sell it, and potentially make a profit on its appreciation, but it also means you’ll be solely responsible for its upkeep (as well as insurance and property taxes). Consider the merits of both options before finalising your decision; you may wish to wait until you’ve narrowed down your property search so you have a better idea of the numbers you’ll face in each scenario.
- Independent search vs real estate agent. It’s possible to run a property search by yourself, using online searches and traveling from place to place on your own. But it’s much better to work with a licensed real estate professional. Real estate agents are immersed in the real estate industry; they’ll be able to give you a much more refined list of properties with which you can begin your search, and they’ll know what to look for in terms of long-term value and curb appeal.
- Location. Obviously, the location of your business is vital to its success — especially if you’re looking for a storefront. Your location will influence your brand visibility, how much foot traffic you’re likely to receive, and how far your employees will have to travel on a regular basis. If you build too far away from an urban centre, you may be difficult to access, but if you’re too close to the center, you could get lost in the noise. Think about your positioning carefully before finalising a decision here.
- Duration and future. Do you know how long you’re going to stay at this location? This can be a major factor in your decision. If you’re purchasing an office for your startup as a temporary hub and you know you’ll be moving soon, you can probably make more compromises on location and quality. If you plan on settling in for years, or even decades, you’ll need to find somewhere perfect that’s likely to remain relevant for years to come.
- Expansion potential. You should also consider whether there’s room for expansion in the future. It’s hard to say how your business will grow, even if you have firm goals in place. If you need to hire several new people, will you have room to fit them in your office? If you choose to offer more products to more customers, can you add a wing to the building?
- Resale value. If you’re buying your property, you’ll need to consider its potential resale value. Just because you’re getting a good deal on a property today doesn’t mean it’s going to appreciate in the future. Think about the future prospects of your respective city and neighbourhood, and how well the building has been maintained to date. Do you plan on investing further to make the location even more appealing?
- Brand considerations. Your brand should also play a role in the type of building you acquire and where you acquire it. For example, a young, hip brand should probably keep close to urban centres. If you want to give an image of staunch professionalism, you’ll need a tall, modern building with few non-traditional characteristics. When reviewing these locations, ask yourself: does this really fit the character and personality of your brand?
Once you have a better idea of what you’re looking for, and what your main priorities are, you can begin your search. Start with a short list of properties that might fulfill your criteria, but don’t rule anything out — especially during the initial phases of your search. The more properties you look at, the closer you’ll get to understanding exactly what you need, and the better the decision you’ll ultimately make.