Retail properties have the potential to earn high investment yields and allow you to take calculated risks and diversify your portfolio. In order to reap the benefits of retail investments consider your budget and see if it you can make it work.
Through thorough research, intensive planning and careful consideration, investing in retail realty can become a very lucrative investment. But before buying anything you must consider your budget, location, use and timing so as to make a sound investment.
Budget- Investing in any type of property is expensive and retail property is no different. First of all, you have to consider your budget and all your over-and-above expenses which go along with it. Determine the size of the property, its location and purpose in accordance to your budget. You also need to consider the costs of repairs and renovation which will go in readying the shop and giving it the look your business requires. You have to include other expenses like stamp duty, business tax, property tax, insurance, maintenance costs, energy costs like electricity etc. in your budget too. If you are leasing your property you can surely pass some of these costs to your tenant.
Location- Finding the right location for your shop is important. You have many places to choose from as to where your business should be located. You have to take into account the type of customers you are likely to attract and their buying behavior. You also have to take into consideration the shop’s connectivity and parking space. Think about your competitors and what your surrounding businesses add to your shop. See if the shop is in an upcoming area with a potential for good clientele or in a degenerating locale where half the retail shops are vacant.
Purpose- Decide what type of business you want to run from your chosen space. If you want to lease the property you will have to consider what type of business is your tenant probable to run. You should know what you are looking for before you start hunting for units and more importantly, whether the business that you intend to do is suited to the property or not.
You need to be sure that you are investing in the property at the right time. You have to consider the market, availability, price and tenant-demand before you think of investing. Your property should get you up on the positive graph not take you on the negative axis. So investing in retail property requires that you do your homework before you sign the dotted line.