Investing in commercial real estate can be highly profitable if done so intelligently and with due diligence. Information portals such as Commercialview.com.au may help prospective buyers get a clearer picture of business properties for sale or lease. Prices, locations and other facts are available for entrepreneurs to use as a basis for further research into the ideal spot for their new venture. Here are a few potential trouble areas that can be sidestepped, once you know what to look for.
Maintenance history
One possible drawback to buying an existing piece of business real estate is that an older building might have outstanding maintenance issues the current owner has neglected to mention. A site like Commercial View can alert you to prices that may not seem right, whether they’re too high or too low. The case may be that the current owner is discounting a shop with known maintenance problems or putting a premium on a space without them. This is why you shouldn’t base your property search solely on asking price, as there may be more to the story than just a number.
An additional maintenance question is raised if you’re buying the equipment of an existing business, along with its commercial space. Bringing along an expert in such matters could be a smart move, since the party selling the business may honestly not be aware of any imminent problems that haven’t yet presented themselves. Sometimes, an experienced eye can see whether certain equipment is going to need maintenance or repair before it breaks down.
Zoning regulations
A quick check of a local government website or a trip to their offices might be the most efficient way of making sure that there are no relevant zoning restrictions. These could prohibit the kind of business you want to open in the space you’re looking to buy. Questions about the kinds of machinery you plan to use, any vehicles such as delivery vans needing access to the building, and other concerns can be handled by a clerk or even by a Web query. The last thing you want to do is pay for a space that you are legally blocked from using for its intended purpose.
Market conditions
The economic world is always going up and down, but certain times to start a business are simply more advantageous than others. With the ongoing financial turmoil in the U.S., Europe and Asia, businesses everyone thought were fireproof ended up disappearing because of market conditions. That isn’t to say that your business shouldn’t be opened simply because Greece is defaulting on loans or the U.S. is raising its interest rates. You must think about the type of goods and services your prospective business would offer. Is it an evergreen business, like food and alcohol? Or is it more of a boutique business, one that depends on lots of extra liquidity among its clientele? One isn’t necessarily a better choice than another; it depends on your particular area’s economic situation. This must be carefully examined, along with the wheelhouse of your venture, when deciding if it’s the right time to open that particular business in that particular location.
Capital issues
The truth will always be that the more capital a new enterprise has on hand, the better it will be able to weather a downturn in business, broken equipment or other challenges. If you don’t have as much liquidity as you’d like for your new business, consider waiting until you do. Some entrepreneurs, however, need to get going as soon as possible, so waiting is not an option for them. Examples of the latter case might be a business that cashes in on a hot trend or a service that you alone can offer now, but that may soon be offered by competitors. The issues are complex, but some serious thought devoted to them may pay big dividends.
In the end, a real estate portal like Commercial View can give you the ammunition you need, but ultimately, you must go out and conduct the hunt yourself. Business success is most easily achieved when you start off with concrete research into its advantages as well as its disadvantages.
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