Key points for buying Albany Commercial Property

Dealing in commercial property can be very confusing especially for investors new to the industry since there are so many different types of properties in the non-residential market. These can include office blocks, warehouses, shops, hospitality venues, childcare centres and many more. The aim of this article is to simplify the process of finding a suitable location to buying commercial property in Albany; all you have to do is to follow the simple points as laid out below.

As most commercial property is purchased through some method of financing, it goes without saying that the property in focus must be properly appraised. The appraisal can be done with the help of professional valuers. These are generally members of a panel of valuation companies approved by the main banks. If you use these people for a valuation then you can take that appraisal to almost any lending institution. The appraisal will give a good indication of the rental income potential as well as the value of the physical property. It should highlight nay works that need to be carried out so you can use this in the price negotiation with the seller. A good appraisal will also suggest how rental income might be improved by showing comparisons with similar buildings in the area and how the current rents compare. The potential buyer of the property will know the risks they are taking and also the true value of the property.

Any commercial real estate investor should get to understand the market they are operating in. This not just the value of other buildings but the market the tenants work in too. For example, a car panel beater will have very different income and cash-flow compared to a specialist engineering fabrication company. You need to know the business of your tenants so you can set your rental income expectations accordingly. For this reason it is often advisable to focus on a certain type of commercial property. To illustrate, you might prefer to buy medical facilities rather than warehouses. It depends on your goals and your market knowledge. If you want some further information, a good commercial property lawyer can give some advice on Albany real estate to think about.

Finding commercial property in Albany

These days the Internet plays a major role in most people’s hunt for commercial investment property. Investors can carry out good searches for the type of property they might want to buy plus they can see some typical rental lease income they might expect. However, this is only ever going to be indicative and certainly does not have any meaning in reality. As you search online, look at all available options that suit your budget but the only way to get hard data is to talk to an agent.

Getting solid advice on commercial property in Albany

A good commercial property lawyer in Albany is indispensable in making a good real estate deal. All the loose ends must be tied up and nothing must be left to chance. The sale and purchase agreement must be reviewed and assessed before entering into any contracts to buy a property. The title deeds must be properly scrutinised so that all details are absolutely correct. In short your interests must be protected at all times.

Finding tenants for commercial property

Leasing your building – image Stuart Miles

As a landlord looking for tenants for any property, it is advisable to do a background check on the people wanting to occupy the property. This is even more important for commercial property than it is for a residential let. If you get a tenant for a house and they skip town without paying a couple of months rent it is an inconvenience since you can easily find a new occupier. However, if a commercial tenant does not pay their lease, the cost to you is much higher running into thousands of dollars rather than a few hundred. Also it is much more difficult to find a new tenant so you can be left without income for a number of months. So it is imperative that you look at any potential occupying businesses and understand their cash-flow.

It is much better to get details clear at the beginning rather than have to try to enforce issues down the track. Again your lawyer can help in setting out the lease agreement and the tenants obligation.

Potential growth value for commercial property

It is important that the property fits into the type of real estate that you are keen on acquiring. Most people look at the income and profit of the building as it currently operates. After all, this is what you are actually buying. However, some people can see how a building or a locality might develop over time. In this case they may be willing to carry a lower current profit or even a loss on the basis of a major capital increase over time. However, you need to be able to afford such an investment. For other people who may not be as comfortable with this type of risk, it can be wise to park your money on deposit with a bank than be in a real estate venture that might not pay off.

Cash-flow forecast for commercial property investment

Commercial property lawyer Albany

As with any property, the cost of maintaining the building has to be worked into the cash flow. Generally the lease will require the tenant to carry out maintenance and up-keep of the property. However some major items like replacing the roof for example, may not be regarded as maintenance. The lease must be clearly laid out regarding who has responsibility for what type of work on the building. Your lawyer will be able to give you some goo pointers here. Also you need to be able to carry out these big repair works and that will require either cash or the ability to borrow to cover the costs.

After going through the points in this article, many readers will see that buying commercial property in Albany is actually within their reach. Before you embark on any project though the best advice is to talk to a specialist commercial property lawyer such as McVeagh Fleming and Co. They are the largest law firm on the North Shore and have a highly experienced team of solicitors who can help you. For more details click here for their website.