Tips for First-Time Investors in Office Spaces

Buying a commercial reale state property is always a difficult task. The majority of real estate invest look for an opportunity to investing their money in residential property. Very few dare to break into the commercial market, even though it can be more rewarding. If you follow the simple steps outlined below, buying office space can turn out to be your best investment. As long as companies and individuals require office space to conduct their business, you will have an advantage.

Now, if you are thinking about investing in office space, you just can’t make that decision in haste.You first have to decide the location and for that you have to look at different locations. You should also contact an attorney to learn about the lease agreements of different office spaces. The more you know about real estate law, the better off you'll be in the long run.

When it comes to commercial properties, investing in office spaces is considered an expert’s cup of tea. It is because of the volatility of property types but if you choose wisely; it is the most rewarding one. The following are some tips for first-time investors in office spaces:

Consider the area and market:

The area should be ready for economic growth, somewhere potential companies want to have their offices. The best scenario is when businesses are booming, and thus they require more employees; hence there is a greater demand for office space. Find out how much office space is currently there and if there are any plans for further development. Scarcity of office space in a high-demand area can mean you get a higher rent.

Considerations of the area should also include access to parking space for cars. Public transportation access should be good also. Connectivity to highways and railway stations is important in terms of entry and exit points. Proximity to these services helps the tenant to go anywhere. In short, it should be easy to get to for everyone.Roads should be under constant maintenance to avoid traffic jams. All these points when combined, help you to earn more rental income.

Consider when to invest:

You can invest in office spaces in three different stages: when it’s being constructed, after it has been constructed and after it has been constructed and has tenants. Select the one which suits you the best.

• The first is the cheapest (but do your research to make sure you don’t overpay) but can be risky as delays and other issues can mean you don’t get your return quickly or sometimes not at all. Do your research into the developer to reduce the risk of any delays.

• When the building has been constructed it has reduced risks – you just need to find a tenant. But in this case, you might have to settle for lower rent than you expect to avoid any delays in getting tenants.

• In the third type, the construction is finished and the building already has tenants. This type is best for someone who is looking for a safe bet, as there is less risk. You are likely to get less revenue though.

The second and third stages of office are most suitable for someone who wants to be safe with their investment. Thus, it is the best stage for first-time investors in office spaces.

Consider the tenants:

As with a residential property, your tenants should be reliable. Rent will be your main source of income from your property. Thus, you have to choose tenants who have good financial stability and will pay on time. Anyone who will damage the property shouldn’t be considered. The best tenants are those who have a bigger name as it can be beneficial for you as well as to everyone.

Before buying the office space, pay attention to the tenants within the building, not necessarily the space you’re buying,and see if they’re regularly leaving.

Developing a co-working space can be a good option for less permanent tenants but requires more admin work.

Consider what you can do:

Look at what you can do to improve your office property to get better tenants and higher rents. This includes making the space energy efficient as it will help to reduce carbon footprint and the tenants will likely appreciate this.

You can also update the basic facilities and air-conditioning to make the space more attractive. You can also provide some modern office space solutions such as a co-working space, placing an emphasis on natural light and plants, having private spaces rather than open floor plans, and providing comfortable furniture. Combining all this can increase the rent and it can fetch a good return on your investment.

For a first-time buyer, it always tough to make the big decisions. Before investing in an office space, you have to be cautious and smart. The above-mentioned tips will help you with initial points to consider. But if you want to know more about the buying trend, you should seek the help of an expert.