Questions to Ask a Real Estate Agent When Shopping for Commercial Property
Now is a good time to buy up a commercial property. No matter what you plan on using your commercial property for, though, there are a few things you’ll want to know about the place before you commit to a purchase.
In case you want to arm yourself with the necessary info needed to make the best decision, here are some questions you should ask your real estate agent about a potential property.
What Deals are Landlords Offering?
Tenant improvement allowances are allowances given by the landlord of a building for the new tenant to build out the space and optimize it for business operations. For an office building, this could mean the opportunity to put up wall partitions. It could also help you renovate the space with safety and hygiene in mind, which is crucial to staying safe as the pandemic continues to linger.
You should also ask about a potential rent abatement, which would give you a grace period to get up and running before rent payments begin on the building. A good real estate agent will be aware of rent abatements for commercial properties and this could save you thousands of dollars while giving you time to get organized and add useful interior features to optimize productivity and communication, like acoustic ceiling baffles.
Should I Lease or Own?
While some business owners are better off buying the property outright, leasing is the smarter move in many cases as well. Depending on your projected growth, cash flow, and how much capital you have to put down, you might be better served leasing a commercial property and using the short-term savings to fuel your initial growth instead.
If you plan on adding major features to the building like architectural metal grilles, for instance, buying the property would be a better choice.
How Long is the Lease Term and What are the Penalties for Breaking It?
If you do decide to lease your commercial property, make sure your real estate agent is well aware of the lease term offerings and the penalty for breaking them as well. The market could shift violently in the near future, requiring you to either cut your losses and bail out or upsize to a bigger property.
If this happens, you want to know that there aren’t any drastic penalties that hinder your efforts to relocate. Many landlords are offering longer lease terms in a down market, so make sure your real estate agent does his/her due diligence to ensure that you don’t get railroaded with massive fees for breaking a lease early.
How Much Local Experience Do They Have?
An agent with location-specific experience will know more about which areas are better for business and have a better network to lean on than an agent who just moved to the area.
Don’t Forget to Ask your Real Estate Agent These Questions When On the Hunt for a Commercial Property
Knowing what questions to ask a broker can be a big help when trying to get the best deal on a commercial property. Especially being informed on lease terms, your agent’s experience, and deals on rent abatement and tenant allowances can save you a ton of time and money, allowing you to take full advantage of an economic upturn in the near future.