The commercial property market has been hit hard by the recession. However, with things looking more positive, experts believe now is a great time for investors to seek out viable business premises for purchase. There is a definite lack of suitable commercial property, so although there are some really good opportunities to be found, the competition for these is high.
Commercial property consists of three main sectors. These are office, retail and commercial.
Office space is one area of the commercial property sector where investors are seizing the chance to pick up a bargain. Property values are significantly less than they were at the height of the economic boom. Owners not keen to sell while in negative equity are holding on to premises where they can. The outcome of this is a shortage of high quality offices. Therefore, those individuals who have the foresight, the confidence and the means to renovate older facilities to a high standard can look forward to some very decent returns in the longer term. There are currently some really good deals around for these investors, such as commercial property for sale Wimbledon. Many opportunities can also be found in other major areas of commerce like Birmingham.
One possible downside is the fact that office space tends to be sold in large areas or lots. This can prove expensive for the individual investor. It is advisable to conduct additional research when choosing space within business parks due to slow market recovery in these areas.
The retail sector has really suffered over the course of the recession. Entire town centres became vast areas of boarded up shop fronts and empty business lots. Thankfully, there are signs things are beginning to change, albeit slowly. Innovative small business start-ups are cropping up all over the place, filling in the gaps, where previously chain stores resided over the high streets. Not all will survive, but the fact that people are gaining enough confidence to take the risk is a good indication of market recovery. Investing in retail premises requires careful consideration and a lot of research. Success is very much dependent upon the type of business and how well it fits in with the local area. A good understanding of supply and demand within the market is essential. As such, smaller investors are advised to consider property in their own local area, where they know potential customers and the dynamics of the region well.
Industrial property is well sought after and very easy to rent out. Start-up businesses continue to increase in popularity and therefore smaller units are in great demand. For individuals just starting out in commercial property, these are considered a very low-risk investment. There are a number of new online sites that provide a matching service for potential commercial tenants and landlords.
Buying commercial property at a time when economic recovery is still in its early stages could be considered a risk. To minimize this, those who decide the time is right should ensure they are well informed and have conducted plenty of research before proceeding.
Want to find out if you have what it takes to be a Real Estate Agent or Broker? About Tom Davidson — Tom Davidson is Vice President of Colibri Real Estate, LLC. which operates online education providers Colibri Real Estate, Insurance License Express and License Tutor. Follow him on Twitter.