Any real estate investment is a serious decision, which is why seeking qualified, professional assistance is a prudent first step. While you may have narrowed things down to the general size and space you require, there’s much more to be considered. Commonly, your real estate councilor can address important subjects that likely have not occurred to you – but certainly demand attention. In no particular order, here are ten critical considerations that must be made in commercial real estate deals:
- Investment alternatives: Is this investment the wisest use of your economic resources? Are there higher returns or less risky alternatives available that might make more sense?
- Ownership entities: Numerous options are available that offer benefits over other choices. Do you know how to find them?
- Tax considerations: Understanding how your federal tax code will impact your investment can allow better planning to minimize your tax impact. Are you comfortable navigating this on your own?
- Financing: Numerous sources are available with varying degrees of interest rates, terms and conditions. Do you know where to find them?
- Funding: This topic addresses your amount of financial leverage versus how much of your own cash is invested, as well as the benefits of each alternative. How capable are you of determining this on your own?
- Risks: It’s critical to fully understand the risks involved before you own any investment. Can you identify and weigh these without professional assistance?
- Length of hold period: This impacts numerous decisions you will make during your ownership and needs to be planned in advance. Do you know what’s best for your deal?
- Disposition: This is a highly ignored topic that has significant impact on the selling phase of the investment. Do you have the experience to manage this?
- Investment performance projections and measurement: You must develop a plan for your invested resources that achieves your financial goals and monitors your track record along the way. Can you create and execute such a plan?
- Tax deferred exchanges: This is a well-known way to swap properties, but you must be clear about the numerous regulations necessary to qualify and stay out of trouble. Are you capable of doing so?
If even one of these ten topics is unfamiliar, you just found a reason to consult a professional. Each consideration is significant. Each can have a major impact on your real estate investment performance. And each can be professionally navigated with an experienced real estate agent.
If any or all of these topics are subjects you’d like to explore, we welcome the opportunity to chat. Please contact us directly today. We’ll also be writing additional posts that elaborate on each topic listed above, so subscribe to our email list to receive updates.