Commercial properties have the potential to be high return investments that continue to produce revenues for as long as they are held, as well as offering excellent resale value to the landlord on being sold.
It is to be noted, though, that all of that is only true as long as you know what you are doing because just like in any other business venture, being a landlord of commercial properties comes with its own set of rules for success.
We are going to focus on a few of the key aspects of being a successful commercial property owner, which should prove to be particularly helpful, in case you are just starting out.
Commercial Property is a Broad Term: Select Your Type Intelligently
Being a commercial landlord simply means that you own a piece of property that is being used for generating business revenues by one or multiple parties.
Therefore, the possibilities here are virtually endless if you think about it. It is for that exact reason you need to figure out exactly what segment the property would be ideal for.
Commercial workshops, retail units, manufacturing plants, etc. are all good options, but it’s best if the venture has at least some relevance to your own business or even personal experience/expertise.
Matching and Comparing Insurance is Essential
If you’ve taken out a mortgage to buy your commercial property there’s a good chance your mortgage agreement will stipulate that you must take out a commercial property insurance policy to insure the building.
However, just because your lender might insist that you insure your shop, workshop or factory doesn’t mean you are under any obligation to take that policy out with them. You can (and should) shop around for the best quotes – and fortunately there are price comparison sites that are specifically designed to help you do just that.
If you need commercial property insurance for a workshop, for instance, Quotezone.co.uk can help you compare workshop insurance quotes from a wide range of commercial property insurers.
The Land Must Meet All Criteria for the Chosen Segment
There are legal and long-term business considerations to be made here. Not all commercial landlords can put their land out on rent to any business that they want.
There are specific legal requirements, limitations, and prohibitions to consider. If you do not consider them in time, the government may take due action against you, which could happen years after the venture’s initial start, or when someone decides to sue you.
Therefore, always be sure that your plan to rent out commercially is not in violation of zoning law or regulation, as applicable. The long-term ramifications could be ruinous otherwise.
There are also certain legal responsibilities of the commercial landlord, which may or may not be specific to certain businesses. Get to know them and make sure you understand your rights and obligations at all times.