Things To Know Before Purchasing Commercial Property
Investing in commercial property in Phoenix, Arizona is a whole new world compared to investing in residential property. This process can be drawn out as you search for a property that will return your investment. As long as you keep the things to know before purchasing commercial property in mind, the process doesn’t have to be hard.
Location is the most important aspect to consider when purchasing commercial property. While it’s impossible to predict the future, you can generally tell how a location fares for the type of commercial property you are buying. Additionally, the popularity of the area can play a role. For example, a popular destination like Scottsdale would likely prove fruitful in terms of a successful commercial business. Is it a restaurant? How are other restaurants in the area doing? Is it built for a professional office? A theater? A large store? Look at how others in the area perform. Also, consider the ease of access for the customers.
Another point when considering the location is the area’s zoning. Is the area zoned for commercial use, or will you run into issues later on? Is it meant to be an office space or an industrial space? Does that work for your investment goals?
Condition of the Property
You also should consider the condition of the property. Will it need any renovations or repairs? What’s the wear and tear on the property as it stands, and what is the value of it? Don’t limit the condition to just the interior, either. You need to consider the exterior and land around the building as well. Is it on a hill that slopes the water toward the building instead of away from it? A commercial property needs proper water drainage, or it can be a liability in the making if you don’t plan accordingly.
Limitations on the Property
Among other things to know before purchasing a commercial property, you should be aware of any limitations on the property. Some properties may have restrictions to modifying the interiors or exteriors based on local laws. Be sure you know those laws and the maintenance that will be involved in keeping the exterior of the property intact.
Finally, look for any hidden costs associated with the property. Is there a major garden outside that you will be responsible for maintaining? You might be underestimating the cost of water needed. Does the property have a big parking lot in a climate that gets feet of snow for six months out of the year and will need to be plowed? Consider the costs associated with running and maintaining the property in advance to avoid being over your budget later. Remember, doing your due diligence is crucial when making such a large investment.