The choice to purchase commercial real estate can be quite lucrative, and it can also give you access to a wide range of other benefits depending on how you use that property. Of course, purchasing commercial property differs from buying residential real estate. How do you get started?
Know Your Plans
The first step is to define what you intend to do with the commercial real estate and how you’ll use it. Will you build a business? Rent or lease the property? Is buying it outright the best decision or could you rent it from the current owner? Will you need a property manager?
Brush Up Your Lexicon
Next, make sure you know key commercial real estate terms, such as loan-to-value, debt service coverage ratio, capitalization rate, cash on cash, and usable vs. rentable square feet.
Make sure you have scouted for commercial real estate in many areas and make a shortlist of your options. Research each one in depth.
Investing in commercial real estate requires that you have help along the way – attorneys, realtors, a mortgage broker, and more.
Buying commercial property will require that you have financing, which means working with a lender who deals with this type of real estate.
Make Your Offer
Once you’ve found real estate that suits your needs, you need to touch base with your attorney and then make an offer on the land.
Your Due Diligence
Once you’ve made an offer and the seller has accepted, it’s time to cover your bases. You’ll need an ALTA survey, an escrow officer, and time to ensure all of your documentation is accurate.
If you’re ready to invest in commercial real estate, contact us at Grecco Capital to take the next step.