Investment in commercial property for your business
Investing in commercial property is one of the most important decisions you will make for your business, so it’s crucial that your decision is an informed one. This post takes a look at your options for investment and considerations you’ll need to take into account before you go ahead.
The Location
Making a decision on the location is half the battle when you’re investing in property of any kind. It’s prudent to do a lot of research about the areas that will be best for your business and weighing up the pros and cons of each against each other to come to a conclusion. Things to think about:
- Local area profile
- Transport links
- Amenities
What Type of Premises do You Need?
For many, location comes first and the building comes second. With the saturation of places like London, and many city centres across the UK, opportunities for the absolutely perfect space may not come around that often. Using an experienced commercial property agent is essential to get the best options. Getting the mixture of space, storage, security, lighting, heating, facilities, and appropriateness for purpose can be a tricky business. There are lots of different types of premises you can opt for that open up the possibilities for you:
- Warehouses
- Retail Units
- Office blocks
- Industrial units
- Mobile trading units
- Development sites
Buying or Renting?
The benefits of buying as a company outweigh the benefits of renting commercial property. So if you have the capital to be able to buy property through your business, it will be a smart investment.
Renting can be argued as money that could be better spent on investment. Owning outright means you will build up equity as property values are ever on the increase and won’t have to worry about potential rent increases. If your business outgrows the premises, you won’t have a rental contract holding you back. Plus, you have the option of using the property as an asset; by leasing the space or selling, you can gain extra capital.
However, there are of course, drawbacks to buying commercial property. The deposit you’ll need to secure the property will usually be around 20-30% of the value in advance, and of course, it’ll be up to you to coordinate the maintenance and upkeep of the building. Depending on many factors, mortgage rates may fluctuate, so, like renting there are major setbacks.
So, there are just a few pointers to get you started on making the most important decision for your business.