When considering NetWork Posting a commercial property investment, it is wise to set standard rules for the review to compare the opportunities the various properties bring you. Investment properties typically exist in the retail, office, and industrial property markets. We will not go into the other property types of tourism and leisure here in this article as they take more comments and lengthy reviews.
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Here is a useful list to consider with investment property.
Some Key Property Concerns
Rent: The levels of the existing rent are important to the investor or landlord, but more important are the stories of rent in the future. It is a matter of what rent escalation the lease allows for and in what time frame. A good lease with a good rent review profile in a sound and well-managed property will always attract investors. Outgoings: These are the property running costs. Importantly, they should be balanced and compared to other properties of similar types in the same region. If the outgoings are out of proportion to similar properties, you need to know why, as any astute property buyer will ask about the outgoings. They know the average outgoings in the area and will not want to pay above the norm unless there is a solid and sound reason.
Supply and Demand: How much other property is coming into the market in the next few years? Will that property affect the property that you are looking at? Could this impact the tenant profile or interest in your property? This equation or consideration is called supply and demand. It will affect buyer and tenant interest in the region in which your property is located. Location: Does the property give good exposure to passing traffic or customers andhas good access to people and motor vehicles? Add to this the consideration and availability of car parking.
Design: Is the property user-friendly and attractive? Good property investment usually looks good and is well maintained. This maintains interest in the property from the tenant’s and customer’s perspectives. If these people feel good about the property when they visit it or use it, then you are well on the way to good property performance. As part of this process, you can conduct interviews with people as they use the property to see and identify any latent concerns. In the case of retail property, this is highly recommended as retail property is strongly geared to customers’ sentiments.
Amenities: Are you providing everything a modern business, tenant, or customer needs? Amenities are many things, depending on what the property is doing or serving. Most people who use the property expect ease of use and access to the amenities, including toilets, car parks, common areas, etc. Retail property has a higher level of consideration in this category. Services: Are your property services modern and performing well? This would include water, gas, roads, electricity, lighting, telephones, etc.
Parking: Are customers and tenants well served concerning the parking of vehicles? Ease of access to the property is critical and at a premium today. Motor vehicles are part of business and life for all people. If parking is not well catered for on the property, then the interaction of the property with public transport is critical.
Tenant Covenants: This relates strongly to the leases and documents of occupation on the property. The word covenant relates to the clauses or lease terms. Every lease can differ, so it pays to read all occupancy papers or leases. Are the leases and tenant profiles strong and attractive to future occupancy?