COMMERCIAL PROPERTY - Why It's A Good Option!
28 August 2018
MAKE THE MOST OF THE BUYERS MARKET!
It’s a Buyers Market, but funding can be hard to get, so how do you capitalise on the current markets favorable conditions?
Lending regulations are often not as stringent for Commercial, Industrial, Retail and Rural investment; thus the money may be easier to obtain.
Now could be a good time to look at alternate options.
To many investors, the thought of commercial property is a mix of fear, uncertainty and a bit of excitement.
Good yields will be a critical element to sustainable investment for the next few years. The yields on offer from commercial property are usually better than those offered in the residential market.
The longer lease terms and the potential for good quality tenants makes these assets very attractive.
5 Key Points to consider when looking at Commercial or Industrial Investment
1. Good Location for intended use – access to potential tenant clientele, public transport for staff, available parking etc
2. Is the surrounding development complementary and vibrant – are there a lot of vacancies in adjoining properties, and are the adjoining properties of a similar or complimentary use?
3. Is the building physically functional for the kind of tenant you are trying to attract, and can you charge the rent you need to, to obtain the return you are looking for?
4. Understand the lease – How long is it? What are the rental increase terms?, who pays the outgoings? Are there any option periods?
5. Quality of the tenant – is the business in tenancy established, growing, paying rent on time etc.
Understanding how these 5 key elements impact on the price you pay, and potential return is critical when purchasing commercial property.
If you want to know more about Commercial Property Investment feel free to contact us to discuss the options in more detail.
