Many experts will agree that investing in commercial real estate is a wise endeavor. Several of the most successful businesswomen and men in the world have an investment property or two within their portfolios. If you are currently searching for some income-generating commercial real estate to invest in, continue below to review some top considerations that will help you be the most successful with your business enterprise.

Commercial Preconstruction Indianapolis IN 317-253-0531

Commercial Real Estate Research

When you are preparing to view potential investment properties, research and strategy are essential. The more you know, the more successful you will be in choosing the right properties for your business objectives. Ultimately, you want your commercial property to produce income. In order to achieve this goal of profitability, it is critical to know what to look for. Here are 5 key considerations that will help in your search:

Location

When it comes to real estate of any kind, location will always be a top priority, as it is always a top factor in terms of filling vacancies. Everyone looking to rent wants the best location they can find, but for commercial real estate, some locations are better than others. Think about the surrounding infrastructure, current construction activity, roadway systems, ease of access, interstate/highway entry, surrounding retail, seasonal activity, population, and more.

Existing Listings and Vacancies

Another important consideration when viewing potential income properties is the current vacancies and active listings included. Are there a high number of active listings? How reliable are they? Is the number of active leases influenced by seasonal activity or cycles? These are important questions to ask. As for vacancies, the same need applies. High vacancy could mean a future of low rental rates and mediocre profitability, while low vacancy can portend higher rental rates due to higher demand for space.

Property Taxes

Your next consideration is property tax. After all, you can’t avoid Uncle Sam, especially in the real estate industry. With each new viewing, you need to have a full understanding of the property tax requirements. But do not be scared off right away by high property taxes, as this could be an indicator of just how high in demand the location is. This is common among Class A commercial properties. Also be aware that high property taxes can exist in less desirable neighborhoods as well.

Average Rental Rates

Numbers are important for any type of investment, so knowing the average rental rates in the neighborhood and surrounding region is a vital step toward selecting the right investment property. The rental income for an investment property is the main contributor to your investment’s profitability. You should perform a comprehensive rental history evaluation and cost foreseeability analysis to fully understand just how much rental income you might be looking at, now and in the future.

Future Development

Smart business people are forward-thinkers. And with choosing a commercial real estate investment property, it is important to understand the potential for future growth and expansion. You can rely on the municipal planning department to provide information on any localized developments that have already been zoned. Furthermore, you want to touch on the volume of construction currently taking place in the area. If there are many, it is suggestive of an area in high demand or showing significant growth, both of which would be beneficial to your bottom line.

Are you looking for a commercial management team to help you with preconstruction service in Indiana? Contact BAF Corporation at 317-253-0531 for p reconstruction services in Indianapolis, including commercial space planning and permitting. We serve clients all throughout the state of Indiana.

Painting and Drywall

A fresh coat of paint is the easiest and most instantly gratifying method of increasing your rental income. New paint makes a property look fresh, and even cleaner. Furthermore, it can displace leftover smells from prior tenants, if any. In addition to a fresh paint job, be sure you are also addressing drywall damages. Dents, depressions, nicks, holes, and cracked joints should be repaired to add more value to your paint job.

Flooring

One of the first things potential renters see is the flooring. Whether carpet, laminate, tile, or hardwood, floors are an important element for them. So, start your renovations with professional carpet cleaning or replacement, or with full-on flooring replacement. Floor cleaning and flooring replacement are two key renovations that can instantly make your rental property worth more.

Pending Repairs

Your next point of interest is to repair anything that is broken. Whether it just came to light a few days ago or has been lurking around your To-Do list for years, making important repairs to your property is an effective and proven method of adding more value to your renters. Thus, you can increase the rent based on your property’s amenities and overall value. From indoor and exterior lighting to bollard posts, driveways, appliances, drywall, and more, fixing what’s broken is a good starting point for increasing rental income.

Kitchens and Bathrooms

Although flooring is one the main elements of a property that a potential tenant will focus on initially, their next priorities are usually the bathrooms and the kitchen. Focus on these areas when planning your renovation budget so that you can earn the most return on investment for your rental properties. Consider minor and major remodels, from painting cabinets and replacing hardware, to installing new fixtures, converting tubs into spacious showers, buying new kitchen appliances, and similar changes. Simply talk to a licensed commercial general contractor to learn how to constructively consider a residential kitchen remodel or easy ways to remodel a master bath.

Basement Conversions

If you have an unfinished basement in your rental property, you have a gold mine of opportunities to increase your rental income. By remodeling a basement, you are instantly and drastically raising the true market value of your rental property. You will get more money per month, plus be able to resell it for a higher price when the time comes! Attics and other areas work well for this type of space conversion ROI.

Are you looking for a trusted commercial general contracting company who can deliver outstanding results for your business remodeling or real estate development project in Indiana? Contact BAF Corporation at 317-253-0531 for reputable commercial construction remodeling in Indianapolis and its surrounding counties.

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What to Consider When Selecting a New Investment Property