If you’re thinking about investing in commercial real estate, then you’re probably well aware that you’re facing a string of monumental decisions before you start seeing profitable returns.
Your property must be managed well for the investment to pay off, both in the short and long-term. To help you do this, we’ve condensed decades worth of knowledge into five essential secrets for getting the most out of your commercial property investment:
1. Enlist an Expert Commercial Property Manager
Every investor wants to get the best possible return on a promising commercial property. However, it could turn into a nightmare investment if you don’t know how to manage it. Commercial property laws are a convoluted web of complexity to get your head around. Add to that the mountain of responsibility that comes with keeping the property presentable and functioning, and you can see why most savvy investors turn to a commercial property manager. A competent manager will take all the pressure off your shoulders, ensuring you get to enjoy a good return on investment, without the headaches.
2. Never Rush
If you’ve got an itchy trigger finger, you may need to train yourself to keep it under control before purchasing your first investment property. There’s a lot more involved in purchasing a commercial property than in buying a house, so it’s important that you cultivate an attitude of patience. Jump in prematurely, and you’re at risk of rushing into a poor decision. We’re all looking to make the most money in the shortest possible time-horizon. However, commercial real estate is not a venture for the impatient spirit. Play the long game and you’ll give yourself a far better chance of reaping robust returns in the future.
From your fellow investors to private lenders, it’s worth building a network of contacts within the investment arena. You could meet the perfect partner for a deal that demands more capital than you can put down alone.
It’s one of the industry’s worst kept secrets that some of the best commercial deals are made before the property has even been listed. How do you get access to these opportunities? In a word: networking. The more you talk with people in the industry, the more inside information you will gain access to.
4. Put your New Network Into Action
All this networking isn’t going to do you much good if you don’t put your new connections to good use. Commercial property deals can go into the multi-millions, so you may find that you don’t qualify for the investments you truly want on your own. However, if you’ve invested your time into finding deal partners and private lenders you can trust, a world of new opportunities will open up.
On the other side of the coin, many investors are surprised to learn that contrary to appearances, an 8-figure bank balance is not necessarily a prerequisite to play at the commercial real estate tables. If you do your research and employ smart strategies, it’s entirely possible to find affordable commercial property locations that are within reach of smaller investors. Once you have your foot in the door, you may be on your way to building a formidable portfolio that will deliver strong yields and long-term financial stability.
5. Know Who You Can Trust
The commercial real estate landscape is filled with all sorts of characters. It’s essential that you develop a good understanding of who you can turn to when you need advice. This includes humans, like your property manager, and online resources offering up-to-date, verifiable information. Not knowing who to turn to can result in missing great deals or the choosing terrible ones. A single environmental regulation can ruin an otherwise brilliant investment if you don’t know about it. Don’t let this be you. Instead, gather your resources and know who you can trust.
Though these secrets won’t bring you instant success, they will put you in the right frame of mind for making solid decisions. Our aim is to set you on the right path for securing a commercial property investment that will reward you many times over for all your hard work. To find out more about how you can build your investments in this exciting area, give MCO a call today.