Commercial properties are an excellent investment option, which guarantees good returns and is safer than stocks or other investment options. Though it requires larger capital, if one can invest in it, it can generate cash flow, which other investment routes lack or do not generate up to the same level. If you are looking to buy a commercial property in India, there are some vital things that you need to look for before investing your hard-earned money.
1.Review the location
After you have selected a location, you need to see the features of the location. It needs to have multi-modal connectivity through roads, metros, railways, or nearby airports. The location should have developed or developing markets.Some areas, currently lacking such connectivity but having the requisite space and prospect of development, will provide better returns in the long term.
2.Amenities
Nearby amenities can make a big difference for your company. Close proximity to restaurants benefits your employees on their lunch breaks and also provides convenient locations for drinks and lunch meetings with clients.A location near banks and shopping areas enable employees to conveniently run errands on their breaks. With nearby amenities, your team can also easily purchase needed supplies for your office.
4.Connectivity And Parking
Easy access to roads, metro or public transport, and ample parking space are important as these enable customers and clients to easily commute to the area, increasing its value.
5.Lease terms
Determine your budget and desired lease length ahead of time. When evaluating different properties, find out if the rent rate is net or gross. In net leases, the tenant is often responsible for paying for parking, utilities and other fees separate from the base rent. Gross leases include these expenses in your monthly rent. Your commercial real estate broker will negotiate lease terms on your behalf, including rent reductions, tenant improvements and rent-free periods
6.Do a proper market research
Before investing in commercial real estate, you need to research the market. You need to assess carefully whether you want a resale commercial property or a new one. The new one carries more risk than a good resale commercial property but also can help you reap better rewards. Tier II and Tier III cities are becoming the real growth engines of India and have the capability of offering better real estate returns.
7.Consult an expert
If you are new to investing and unaware of real estate, then it is best to consult experts. There are many real estate consultants, lawyers and property developers who are experts in this field and will guide you through the entire investment process.
8.Evaluate the layout plan
Evaluate the layout plan before investing in any property. A sound layout plan includes the size of plots with dimensions of building lines and setbacks. It includes the location and width of the existing as well as the proposed roads, the location of drains, public facilities, and services along with electricity lines, a statement indicating the total area of the site, the area under roads, open space for parks, playground, recreational spaces, and other public places, as required by a specific section of the development code
9.Location and accessibility
The location of your property is one of the most important factors to consider. You should choose a space that is easily accessible for your clients and staff, so you’ll likely look for properties near major roadways. Be sure to evaluate employee commute length and local traffic patterns. Your commercial property should also have ample parking.
10.Check the quality of the tenant
Check the quality of the tenants in the area before investing. If you are buying office space it is better to have reputable companies as your tenants. Checking the occupancy in the surrounding areas will give you an idea of the type of tenants settling in the locality. If you are lending to large companies, it is better to have a long-term lease agreement. A long-term lease agreement helps you handle the downturn cycles of an economy better.
