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commercial property for lease

Would You Purchase or Lease a Commercial Property?

When it comes to commercial property, you have two options: purchase or lease. Before making any decisions, it is important to thoroughly weigh the pros and cons of both options. Luckily, we have broken it down for you here.

Choosing a Commercial Property for Lease

When it comes to a commercial property for lease, consider the pros and cons.

Pros

Cost-Savings If the success of your small business depends on location and image, there is an excellent chance that you will spend less on the location as well as told have to pay for maintenance and improvements on the building.

More Available Capital – With leasing, your money does not get tied up as it would when buying real estate. That means that you have more working capital to help grow your business.

Fewer Headaches – As someone who leases commercial space, you do not have to worry about things like maintenance issues, landscaping, updates, and so on. Instead, the property owner handles those things on your behalf.

Vacancy and Value Worries – As a tenant, you also don’t have the added worry of real estate value drops and increased vacancy rates. In fact, you can take advantage of vacancy rates and lock in on a high-profile location for less money.

Cons

Fortunately, there aren’t many disadvantages to leasing commercial space. One thing to consider is that you might experience a rent increase at the time that your contract expires. Also, when leasing, you do not build equity.

Considering a Business Building for Sale

There are both positive and negative aspects of owning commercial property.

Pros

Deductible Taxes – You can deduct taxes as a property owner, including property taxes, interest on the mortgage, and so on.

Enhanced Revenue Stream – If you have vacant offices or conference rooms, and are interested in managing your own tenants, you can rent the available space out as a way of increasing your revenue stream.

Equity –  Over time you can build equity in the commercial building that can be considered an asset for your company.

Cons

The downside to being an owner is that, depending on your company, the building may or may not suffice for future needs and you have less flexibility to react to those needs. You also have several upfront costs to consider that may result in less capital that can be invested in growing your business. You will also be responsible for ongoing expenses and execution of maintenance, landscaping, upgrades, appraisals, and more.

If leasing is the right choice for you, current commercial rental listings are available through the Strategic Group. These listings include information such as floor plan, square footage, address, and high-definition photos. For more information, please visit us online or call to speak with a company representative.