CAPITAL DISTRICT — Imagine waking up with a piercing pain in your back, making you immobile. Like preparing an entire Thanksgiving feast for 40 people in two hours, the pain is overwhelming. Are you going to try to treat it yourself? No, of course not. You are going to hire a medical specialist to figure out the problem. You don’t know what you don’t know.
When you are considering making an investment in commercial real estate or selling property, the first thing you should do is engage a Commercial Realtor.
There are numerous situations that require the services of a Commercial Realtor. The two most common circumstances are leasing space or selling a building. Perhaps your lease is going to be up in the next year. Hire a Commercial Realtor now to help you look at other lease options in the area, or to help you renegotiate your new lease before it expires. What is the current market rate for a space like yours? Are you at or below the market rate for the type of building you are currently in? What changes do you need in the space that is unique for your work environment? What is reasonable to expect from the landlord regarding the costs for the changes, and who will pay for these changes? A seasoned Commercial Realtor will help you answer these questions.
If you are going to sell your building, a Commercial Realtor will help you to determine the correct selling price by looking at similar properties sold recently, as well as current comparable inventory on the market. A Commercial Realtor will take into consideration the condition of your real estate and whether the property has been well maintained. Another factor he or she will examine is the rent roll (the current tenants in place). Do they have long-term leases? Are these leases at or below market rental rates? The Commercial Realtor will create a proforma (financial analysis) based on the information you provide about expenses and income to show the Net Operating Income (NOI) for the property. This will also help a buyer to determine their rate of return on the investment over time.
If you are having a medical issue, you will get a doctor. If your home has an electrical short, you will hire an electrician. You don’t know what you don’t know. However, if you are serious about making a commercial real estate acquisition, you do know that the very first thing you should do is hire a Commercial Realtor.
Jessica Richer is a licensed Associate Real Estate Broker with RealtyUSA Commercial Division. For more information, call 364-7406 or email [email protected].
— Jessica Richer