National Brokers Network

Property Investment 101: Understanding Commercial Real Estate

You might have read a lot of articles about residential property investment as many investors are more comfortable with investing in residential properties. Today, there’s been a drastic increase in the demand for commercial properties. However, many people (especially new investors) are not familiar with the terms and conditions of commercial leases, GST implications and other important details.

This post will provide readers with a brief insight into the world of commercial real estate. Read on to know more about it.

Understanding the commercial properties

Commercial properties come in three different types—this includes industrial, office, and retail properties. Clearly, investing in commercial real estate is quite different to residential real estate. It may seem more challenging, but you can definitely gain a lot of profits if you know what you’re doing.

To give you more ideas, here are some of the things you need to know when you consider investing in commercial properties:

ü  Identify the possible risks

Knowing the possible risks you will face in the future is very important. In commercial real estate, you need to anticipate the vacancy rates. One example is the warehouse. It could take so much time to find a tenant for the warehouse.

ü  Find a good tenant

Let’s face it, finding a responsible tenant is hard to find these days. This is why they need to undergo a thorough screening process. Get to know more about them. Are they planning to renovate your unit? What is their business? Make sure they have complete documents for your own security. It is also advisable to discuss your terms and conditions.

ü  Know when to invest

Knowing when to invest is also crucial. Get updated with the latest economic news. Consult a financial advisor to make sure you are making the right decisions. Be patient and always take your time.

ü  Prepare for maintenance costs

 Just like residential properties, you need to prepare for maintenance costs. You should also anticipate other upgrading costs like a new ventilation and other health hazard structures.

ü  Complete documents

Make sure you have all the necessary documents needed for a smoother future transaction.

These are just some of the few things you need to remember when investing in commercial properties.It is also advisable to seek professional help to make sure you’re on the right track. Look for licensed brokers or tenured property managers to help you sort things out.

Confidentiality Agreement

In Consideration of the Vendor of the subject business, or any other business introduced to the Proposed Purchaser and their agent National Brokers Network (“the agent”) providing information to the Prospective Purchaser, the Prospective Purchaser agrees:

1. To keep all information provided confidential in respect to the subject business and any other business introduced to the Prospective Purchaser by the Agent.
2. That no information is to be disclosed by the Prospective Purchaser to any third party without consent by the Agent;
3. That it will not use for themselves. Or for others benefit, such information other than to Purchase the subject business or other business introduced by the Agent;
4. That any agreement to purchase the whole or portion of the business shall be exclusively through the Agent;
5. To immediately return to the Agent all such information and other details in written form including any drawings and any copies made of written information, notes, summaries or extracts of any document therefor if any when requested by the Agent;
6. Under no circumstances will the Prospective Purchaser make direct contact with the vendor of the subject business or other introduced business without the prior written consent of the Agent;
7. If the Prospective Purchaser breaches this agreement or buys the business direct from the Vendor, the Prospective purchaser is liable to and indemnifies the Agent for any and all losses the agent may incur including economic loss and loss of income.v

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