re:- Commercial Property Investment

[kero]

Am looking into a partnership with parents... possibly a commercial property investment i.e. office & budget $500k including cost, but we are quite green, not really know where to begin, besides the forum.

questions to the forum members are:

1. Is there a minimum floor area we should look into? There are some office space about 40m2 for sale. But who would actually rent such a small office? If i am a one man-operating company, wouldn't i be better off working from home than renting a small office space?

2. Besides the coporate and council fees, are there any other?

3. Like residential, should we follow the same property investment mantra- location, location and location?

opinions from anyone would be appreciated.

thanks in advance.

 

[pulse]

Hi Kero, I don't know much about commercial but I have a couple of small commercial places.

For commercial the value in the property lies in the tenant and the lease. Commercial is also not good as a first or only investment due to the potential for long periods of vacancy.

Outgoings are normally paid by the tenant but you will need to pay some insurance.

For a bargain, look for a place that is having trouble finding a tenant, then solve the problem and find a bluechip tenant... then you can sell for a good profit.

Cheers
Pulse

 

[Michael Yardney]

kero

The rules for commercial property investment are very different to those for residential investment. Make sure you know how to play the game.

This article may be a good starting point Residential or Commercial - Which is right for you?


There is also a good book by Chris Lang - How Commercial Property Works

 

[sailor]

I have 2 small commerical units, and they are very suitable for people for whom it would be inappropriate to work from home. Also in the same block there is a travel agency, employment agency, computer repair shop, mortgage broker, etc. Sometimes the location (if in CBD) is better for passing trade, where the person's home is too far out of town, or too small, or doesn't have a suitable office area.

 

[kero]

thanks fellows... will brainstorm these points to my old man.