Not all Small Commercial Building For Sale Near Me in Montague Gardens should be auctioned, but the auction method of sale does have real advantages if the property is just right and the market is accepting of that method of sale. Here is why.
The key governing factors to determine if auction is a real chance or choice for the commercial property owner are the current levels of enquiry for that property type, and the prevailing business sentiment. If this is the case then you can look further at auction.
The auction method of sale is a proven time based sale process that flushes out the enquiry and if the investment property ticks all the other boxes such as acceptable (and not excessive) levels of comparable property on the market that are competing with the subject property coming up for auction.
Do not overlook the advantages of auctioning a commercial property. Just make sure all the other existing elements are in support of that method of sale before you start, which is why they use commercial business industrial property buildings for sale agents.
How Do You Select The Commercial Business Industrial Property Buildings for Sale in Montague Gardens?
Selling commercial property is not an easy task. The most common thought that comes to most when selling property is which real estate agent to choose. There are thousands of real estate agents that are listed in the phone book, online, advertised on television and in the street. So who do you choose?
Never go with your first option - there are so many real estate agents to choose from, so you should always research agents thoroughly. Selling your property is an important decision, so make another important decision by choosing the right real estate agent. Find out how below:
• First, try to use someone that is reliable. The best way to find out who is reliable is by seeking candidates that your friends or family have used in the past. These people will be able to give you a truthful and firsthand experience of what it was like to work with that particular real estate agent.
• Another benefit of the real estate agent is if he or she has sold and is familiar with the neighbourhood where your commercial property is located.
• Lastly, the schedule of you and your agent should be compatible. Communication is key in selling property, but if you and the agent cannot find a common ground in your schedules, it is unlikely that the partnership will turn out favourably.
If you follow these tips to choosing the best real estate agent to sell or lease your commercial property then you should be well on the way to being a happy landlord or even a very wealthy vendor!
Commercial Property Types-Which One Is The Best?
"Property on ground lease" is among the most confusing phrases, even to commercial real estate brokers. There are up to 3 parties in a "property on ground lease": the business owner, e.g. Burger King, the landowner and the building owner. When you see a sale of "property on ground lease", it could mean:
1. Sale of land only. In this case, the building owner is the tenant, e.g. Burger King that has a business in the building. The tenant typically signs a 10-20 years absolute NNN ground lease with the landowner to lease the parcel. Should the tenant not renew the lease or be in default of the lease by not paying rent, the building with substantial value is reverted to the landowner. The tenant will make every effort to pay rent to avoid losing the building to the landlord. And so the cap rate for this property is about 1-2% lower than a property with both land and building.
There are a couple of possible scenarios that could lead into a land sale only:
· The business owner, e.g. a Burger King franchisee, could own both land and building originally. He then structures the sale of land only to an investor and then leases it back. He receives the tax benefits of being able to depreciate 100% of the building and fixtures. The tenant could later sell his interest in the building without the land to another investor and lease back the building.
6. Is it easy to sell your interest if the lease has a few years left? If you own the land, your interest may be hard to sell, but still sellable. Once the ground lease expires, the building owner owns nothing. As a result, this can make it quite challenging to find a buyer for the building.
7. Tax write-off's: Land does not depreciate for income tax purposes. The building, on the other hand is 100% depreciable.
8. Financing: if you buy the land portion, you should be able to obtain 65% LTV financing in today's market, just like a typical property with both land and improvements. However, it's very difficult to get financing for the building acquisition, especially when the ground lease has less than 20 years left.
Therefore, when you see a "property on ground lease" for sale, make sure you know what you are buying, considering there are many factors involved that can adversely impact/contest an investor's decision. If you're contemplating on buying the building without the land, think twice and make sure you have a clear understanding of all the plusses/minuses involved in this decision.
Find All Small Commercial Building For Sale Near Me in Montague Gardens
Though it is certainly more common, and in many cases easier, to find deals with the single family houses, there are times when the opportunity presents itself to acquire a commercial property. And if you are a person who desires to pursue this venture, there are a few things you want to keep in mind when doing this. Following these simple steps can help speed up the process of getting some of these big deals in the pick line.
First, FFN offers a Commercial Property Boot Camp. This is a must if you want to pursue this arena of the real estate business. This course will teach you all the ins and outs of going through these business transactions. See the website if you want to know when the next one will be offered.
You will also want to keep your eyes open when you're riding around town, especially for fiz-bow signs (FSBO - "for sale by owner). If you see fiz-bow signs on big tracks of vacant land or any type of property, you will certainly want to call those numbers. When you are dealing with fiz-bow in the commercial property world, there is usually a reason they are trying to sell these properties themselves. And sometimes this can lead to some really good deals.
Investing in commercial real estate is entirely different than buying residential properties. Commercial properties are substantially more expensive and must comply with state and local zoning laws. Property owners must have appropriate permits and insurance prior to leasing space to tenants and include provisions according to the American with Disabilities Act.
Commercial real estate includes a variety of properties such as apartment buildings, condominium complexes, shopping malls, retail outlets, office buildings, industrial parks, and plots of vacant land.
When investors purchase vacant land the property must be inspected and approved before buildings can be erected. Property owners must obtain appropriate building permits through their county's zoning commission. Investors need to conduct due diligence to ensure properties are zoned for commercial use before submitting a purchase offer.
Leasing rates for commercial real estate is substantially higher than residential properties. Depending on the area, rental home prices hover around $5 per square foot, while commercial leasing prices can be $10 to $15 per square foot. Prices depend on the type of property, location, and facility use.
Buying commercial real estate can offer a higher level of profit than residential properties, but also carries a higher level of risk. Investors must take time to understand all aspects involved and partner with professionals who they can turn to for advice. Otherwise, they place their self at risk for foreclosure, lawsuits, and tenants who default on leasing agreements.