Due diligence should be practiced whenever you are buying real estate in Fort McMurray since it is a capital intensive undertaking. The lack of planning is linked to a number of challenges such as unexpected construction costs, inadequate financing, environmental lawsuits, and inefficient layout.
Entrepreneurs will always be better off buying property rather than renting. It doesn’t matter that real estate costs have risen substantially in the past decade. The advantages of purchasing property are avoidance of rent increases and the property will be appreciating in value. The value of loan, mortgage and depreciation can be deducted from company taxes which is not possible when renting.
The following tips will be important for successful real estate acquisition:
1. Understand the Fort McMurray real estate market
Every local real estate market will have its own inventory, local tax rates, and environmental issues. You will need to research where you are buying before committing to buy. Do not forget to evaluate the supply of skilled labor in the area.
2.Work with an accountant
Find an accountant who will work to determine your budget since affordability is a big component in Fort McMurray commercial real estate. The budget should include any hidden costs. The accountant will also help you navigate tax matters which are generally complex in real estate transactions.
Other issues to work on are transition financing, succession planning and the decisions on how the property will be treated when the business is sold.
3. Prepare your financing
It is not easy to get approved for commercial real estate financing. The bank of your choice will want to look at your financial statements and ensure that profits are retained within the company. A warning is sounded that you should not have overly optimistic forecasts to avoid payment problems down the road.
Shop around to find the best financing package without forgetting that the interest rate is an important consideration but not the whole story. Do not forget to evaluate the percentage of the purchase that the bank is willing to finance.
4. Plan your layout
Layout has a role to play in the operational efficiency of a business. You should hire a professional to design and optimize your layout whether you are renovating or working on a new building.
5. Work with the right builders
Choose and work with builders who have experience, knowledge of the industry, a good reputation, timeliness and are responsive to client needs. This implies that if the building must meet food industry standards, you must work with builders that have expertise and experience in the industry.
Look at other factors such as the financial history of the builder. A credit check will help eliminate any doubt. You will not want to work with a contractor that takes your deposit to fund a previous job.
If you need any help with commercial real estate acquisition in Fort McMurray then consult with our Fort McMurray realtors today and we are here to make the process easier for you.