When dealing with commercial real estate, you?re dealing with a different monster entirely. You need to get your ducks in a row with anything commercial. No matter how much you think you know on this subject, it is possible that you are missing something small, or that you were unaware of. Here are a few great ideas to help you in your commercial real estate ventures.
You need to look after commercial property just as you would if it were your domestic abode. So if you have a shop or business premises, like a hair salon in Vancouver for example, remember to have it professionally cleaned by a maid service or carpet cleaners to keep it looking good.
Consider any tax benefits you?ll receive through a commercial real estate investment. Investors may receive interest rate deductions as well as depreciation benefits. Investors often get ?phantom income? this is income that does not have tax attached. You should be mindful of phantom income prior to investing.
Be clearheaded about what amount of square footage is really usable. Commercial real estate properties can be measured by usable square feet, which is where the business would actually take place, or total square footage, which usually involves the walls and uninhabitable spaces. It?s important that you know both measurements for any property on your short list, as this will affect what you offer for the property.
The first step is to find the best lender to finance the transaction. Home loans are much different than commercial loans, so there is a lot of new information that you must learn before you begin your search for a piece of commercial property. These loans are actually a lot better in a number of ways. Larger down payments are required for commercial financing, but you have the safety of avoiding personal liability should things not end well. Banks are also considerably more lenient about letting you borrow down payment funds from associates.
Consult your tax adviser before buying your first commercial property. They?ll be able to discuss the long-term cost of the building, and what the tax rate for owning the building will be. Work closely with your lawyer to find a place where you can buy property and your taxes will cost less.
This is necessary to enable you to confirm that the terms fit with the rent roll, as well as the pro forma. If you don?t read over these terms, you may find something that?s not the rent roll and it could change your pro forma.
Finding your optimum commercial real estate property will only see you half way through this process. When you have the information you need, decisions are much easier to make.
March 11th, 2012Topic: general Tags: carpet cleaners, hair salon in vancouver, maid service
Source: http://www.gonotti.info/things-to-consider-about-the-commercial-real-estate-market/
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