A collection of tips on how to begin with buying or selling commercial real estate makes the perfect starting point for a beginner to emerge. The tips that follow will help put any beginning real estate investor on the road to becoming a pro.
Be sure to negotiate on the fact of what you are, the seller or buyer. Be sure that your voice is heard so that you can get yourself a fair price on the property you are dealing with.
Whether you want to rent or lease, you will have to deal with pest control. This is important in less desirable locations where rodents and/or bugs are an issue. Have your rental agent inform you of any associated policies for pest control.
Location is a very important part of commercial real estate. For example, consider the surrounding area and local neighborhoods. You will also want to calculate growth expectations by comparing similar neighborhoods. Do not buy a property that is located in a neighborhood likely to take a wrong turn in the next five years.
Net Operating Income, or NOI, is one of the most important metrics used in commercial real estate. You must understand what it means, and how it’s used. In order to be successful and stay profitable, watch this number closely, and take steps to make certain it does not fall into the negatives.
If you want to rent your commercial property, well built solid buildings are your best bet. These properties are generally top sellers because prospective tenants can see how well-built and maintained they are. This type of building also has the advantage of requiring less maintenance, an attractive feature for tenants and owners alike.
Try to keep your commercial property rentals at full occupancy. If you’ve got open spaces, then the person will end up paying for maintenance and upkeep. If you have several properties open, you should ask yourself why, and attempt to correct the issues that may be driving out your tenants.
Thoroughly tour every potential property. Consider going with a contractor when you are looking at places you want to buy. Submit a first offer and solicit counteroffers. Evaluate counteroffers against the information you collected on your tours, and use that information to justify your own counteroffers.
When you are composing a letter of intent, you should emphasize simplicity by negotiating on the bigger issues first, then addressing the minor issues later in the negotiations. By focusing on the big stuff first, you will have more pleasant negotiations, and you will be better able to manage small matters in the end.
Regardless of whether your interests lie in purchasing, selling, or investing in commercial real estate properties, following the advice in this article is a great way to get started or put yourself ahead of the pack. With the collection of tips in here that were constructed in order to help you build on your selling and buying skills, you can become that much more successful with commercial real estate.