Putting your money into bricks and mortar is generally seen as one of the safest investments business owners can make, with commercial property in particular typically resulting in high yields. Last year saw a record number of investments in commercial property in the UK, but after such a turbulent 2016 many will be wondering if now is the right time to buy. Here’s what you need to know.
What Is Commercial Property
There are several different types of commercial properties including offices, industrial buildings, retail stores, and warehouses. Depending on the type of business you run or your current property portfolio, certain kinds of property may be much more suited to your interests.
It’s also important to consider the terms and conditions that may apply when negotiating a commercial property purchase. For instance, when buying an industrial building, it’s possible that you will need to submit for government permission before you can start operating your business.
Conversely, when shopping for office space, consider how much room per employee will be necessary as well as the kind of amenities that most renters will be looking for, like internet access and security.
How Does It Compare to Residential Properties?
While commercial properties usually offers a higher return-on- investment compared to residential properties, it’s important to realise is that the initial purchase price is often much higher. However, while large-scale commercial properties will be out of the price-range for most companies, it is still possible to finds shops, offices, and other individual properties at affordable prices. If you have previous experience as a residential landlord, you’ll find that the experience of being a commercial property owner is quite different. Since you’ll be dealing with a business rather than an individual tenant, you can expect a more professional relationship as they’ll wantto protect their public image.
What Are the Best Locations
Choosing the location of your next property is a difficult decision right now. Despite what many may initially expect, London may not be the best location to invest in at the moment. According to recent reports, commercial property markets in the capital were dealt the biggest blow after Brexit and currently lags behind many other places in the UK.
The decision to leave the EU hasmany investors cautious about where to place their money. Market experts Savills have instead placed their focus on the nation’s so-called second city, Birmingham, whose office market has continued to do well after a record-breaking 2015. Take-up is expected to finish the year 63% above the long-term average.