Buying commercial property involves significant capital outlay and therefore extensive planning, which makes it quite different from purchasing a home. But while it may seem daunting, investing in commercial real estate can offer potential rewards in the form of steady, additional cash flow. Aside from knowing what you want and where you stand, below are a few more practical tips to get you started.

How to Purchase Commercial Property

1. Learn the Lingo

Get savvy by learning some of the key metrics used to evaluate a commercial property. Familiarize yourself with terms like net operating income, capitalization rate, cash on cash, and rentable square feet, to name a few. Knowing the vocabulary will help you understand the industry better and work with real estate experts more easily.

2. Study the Local Market

One of the most effective ways to assess commercial property is to learn more about its neighborhood. For instance, there might be plans to construct a shopping mall, which can divert traffic from your property. As with any real estate purchase, location is critical. Learn about the environmental issues, zoning laws, and building codes applicable to your potential property, as these will eventually have an impact on your decisions.   

3. Have a Few Options in Mind

There are plenty of ways to find commercial properties for sale, such as by searching the internet, reading classified ads, and calling brokers, so don’t limit yourself to only one channel. Have at least two options to choose from that you can visit personally.

4. Perform a Site Inspection

Before settling on commercial property, ensure that you’ve done a thorough inspection of its facilities. Look out for signs of deterioration or physical wear on the building, which might require extensive repairs or renovations. Check out other features, such as adequate parking and handicap access, and ask whether there’s an opportunity for eventual expansion.

5. Consult With Experts

Because a commercial real estate purchase is complicated, it’s best to consult with experts who can offer advice on what your next step should be. At the very least, hire an accountant and real estate lawyer to handle the documentation. You may also need an appraiser or engineer to accompany you during inspections.  

If you’ve found the ideal commercial property to invest in, consider owner financing to help you get started. Talk to the professionals at SWE Homes in Houston, TX, for assistance on commercial real estate transactions. With their extensive information on the neighborhood, they can help you get the best real estate deal. Call (713) 413-1000 or visit them online to view their listings on commercial properties, land for sale, and new homes.