An investment of any kind can feel risky, especially when you are making a significant monetary and time investment into such a venture. Beginners can always feel like they are at a disadvantage. However, there are several ways to ensure a measurable return from your property. Follow these simple steps to make sure your commercial real estate investment is sound before you make a huge commitment:
Get a Coach
Whether you are needing some help in sales, leasing or in all around property management, hiring a company that specializes in corporate real estate is your starting play. Some companies will help you research the market and find a space that satisfies your needs, they will also help you lease the space to potential prospects.
Or, if you’d rather remain a silent partner in this type of investment, these companies can also handle the direct on-site management for you, as well. Regardless, having a good team in your corner can help the investment rookie and the seasoned professional. They are there to make your process easier.
Get a Partner
Another way to make your investment process easier and less costly is to find the right investment partner. It can be tough starting out to invest on your own. Rather than going it alone, many individuals or entities choose to share the cost of investment with other individuals. Some partners are creative engines while others want to invest more with money or manpower. Find someone who either shares your creative vision or can fund it and you’ll be leaping closer to your perfect investment experience.
Create an Ideal Model
After finding the right people, you need to come together to create a workable, malleable, but structured business model. A business model defines the structure within which the company will operate and what your investment will tangibly go toward. Is the main goal revenue or appreciation? Will you be banking on this being passive income for you or your monthly stable income? A business model also forces you to write down goals that you want to achieve and what to do if you don’t reach those goals. A business model is your plan of attack.
Profit versus Time
Another great question to ask before you invest is to look at what type of measurable profit you are wanting. Are you wanting to see gains every month? Or are you looking for a more stable amount that only fluctuates once or twice a year? These questions can help you decide if you are looking at holding onto a property and leasing it, or if you are wanting to flip a property and sell it outright. The choice is yours. If you are not worried about your day to day bills, having a more radical profit return time may be what you want to shoot for.
Location, Location, Location
It may seem like an obvious thing but deciding where you want to invest can help you in all these other areas. Do you want to invest locally, in the same country, or abroad? Are you wanting to lease or sell? Do you want to invest in an urban, suburban or small-town location? Those can be determined by the role you want to play in the investment and what your end game is for your profit margins.
Whatever your dream investment looks like, you need to make sure you have the right people and the right information before you dive into the deep end with your time and your money.