How to Choose the Right Commercial Investment Property



Investing in commercial property is a major decision that consists of crucial elements, including: your leasing strategy and the type of property you invest in. Not to mention, land developments and building improvements. Taking all of these elements into considerationwill help your investment grow. Before purchasing commercial property, you must weigh the pros and cons against your investment strategy. This will ensure you choose the right property for your portfolio. 
Create a Good Leasing Strategy
Your leasing strategy is a major component of investing in commercial property, whether you’reinvesting for rental income or capital growth. A good strategy is tantamount to excellent asset performance. It should leave room for maintenance provisions and rental reviews. This will help you remain competitive and ensure all improvements are up to code.
When reviewing the lease, consider whether the asset offers opportunities for depreciation, if it will impact overall asset performance and if you own the fit-out. For more understanding of your lease and the terms, you should also invest in good commercial property management. Managers like Group Three Property Management will create a great leasing strategy for and ensure you are aware of and understand the major components of your lease(s). 
Investing for Rental Income
If rental income and cash flow are your ultimate investment goals, then you should invest in higher yield properties. High yield properties are generally those above an 8% rental yield. Yields at this rate allow you to generate a sizable rental income, pay for your mortgage and other expenses and profit from your investment. However, the best commercial property management companies in Edmonton will tell you that high yields aren’t the key to finding the best investments. In fact, capital growth is the most important reason to invest in rental property. 
Investing for Capital Growth
Not all commercial property types lead to good asset capital growth. For optimal capital growth, you should invest in certain types of commercial property – like high-quality retail space. However, the location of the space matters as much as the space itself. In fact, the location and position of the property should be a major consideration for investment. Since location determines the supply and demand for land, it also determines the value of your land and property. Capital growth occurs when the value of that land increases. However, the value of your land won’t increase if the property isn’t in a good location. Just be sure to invest in real estate that matches your portfolio.

Comments

Post a Comment

Popular posts from this blog

How to Select the Best Property Manager for Your Property

Hiring a property manager will lower your workload and give you assurance that, should any problems crop up, an experienced professional will take care of them immediately. Whether you’re looking for apartment, public housing, office, or condo property management , you need to ensure that you pick the right manager for you. 1. Gather Referrals A good place to start is asking for referrals. Ask your network, including the realtor who sold you the property, for suggestions. 2. Look for Accredited Companies Accreditation signifies that a property management company meets strict professional and ethical standards. It also shows that the company has the abilities to deal with any issue in an efficient and timely manner. 3. Seek a Company in Your Area Ideally, a property management company should already be familiar with your area. This will mean that managers are knowledgeable of your target market and how to serve your clients. 4. Find a Company with the Right Experience ...
Read more

What Should You Expect from a Professional Property Management Company?

For first-time clients, it is difficult to know what you should expect as standard from a property management company. To rule out any companies that try to sell you short, it is critical that you know what you should be receiving as a minimum. 1. Expertise in Their Area There are two main types of property management companies: commercial and residential. You need to choose a company that has the appropriate knowledge for your type of property. This will ensure that you never break any laws and that your property is run efficiently. 2. On-Call Service Your residential or commercial property management company should be able to provide you with an on-call service 24 hours a day, every day of the year. If tenants suffer any problems, day or night, someone should arrive within a short time to take appropriate action. This is essential for dealing with emergencies, but it also shows tenants that they can rely on you even in less-urgent circumstances. 3. Personalized Ma...
Read more

Reasons You Shouldn’t Manage Your Investment Property Yourself

After purchasing an investment property, you’re likely looking for ways to maximize your profits. One idea you may have is to manage your property yourself instead of hiring a commercial property manager . This is never a good idea for several reasons. 1. You Have No Experience in Condominium Management Managing an investment property is far more complex than it appears on the surface. You’ll need to deal with repairs and maintenance, collect the rent, and resolve an array of tenant complaints. All this calls for experience and know-how. 2. Managing an Investment Property Is a Job Managing an investment property is at least a part-time job. In fact, if you have more than one unit, it is likely a full-time job. You’ll need to be available at any time to handle problems. If you’d rather not dedicate so much time to condominium management , you’re better off hiring a commercial property manager. 3. It’s Inconvenient Managing your property is particularly problematic i...
Read more