Investment in commercial real estate is way different from the residential one. Thus, you must know the factors that determine a wise commercial deal. The property investors have an idea of the return on investment in the residential sector but one should also know about the potential of ROI in the commercial real estate. Thus, this blog post offers a detailed overview of how to crack a wise commercial deal.
Tips to seal a Commercial Deal:
1. The investor must understand the target market and then look for a commercial space. The medium to large-size commercial area is perfect for corporate companies.
2. The investor with the potential to acquire area more than 10,000 sqft must opt for CBD [Central Business District] in the preferred localities.
3. The commercial property must have an appealing look and should be located in a prime area. The social infrastructure, demand for office spaces, connectivity and security are the main things to consider before finalizing a commercial property purchase deal.
4. The investors must have a concrete plan to yield a higher return on investment such as discount on lease for long period. Primarily, the investors must try to earn 8-9 percent return on investment.
Capital Appreciation & Commercial Properties:
The commercial property market also witnesses price fluctuations and thus the properties located in the market areas have the potential to earn increased ROI. The existing infrastructure and the proposed infrastructural development play a key role in the capital appreciation of commercial properties.
Investment in commercial properties offer both long-term gains and short-term gains and these perks are sometimes bigger in amount when compared with the residential properties.
The investor must opt for a commercial property that is on lease already as it offers a better return on investment in comparison to the one that is not on the lease. Investing in a non-leased commercial property is like burning a hole in the pocket as you are required to pay the maintenance cost and other expenses.