Commercial Property Buyer Tips
A commercial purchase is mainly a numbers game. Before investing in a large building, get, find and uncover all of the information that exists on the property. From the seller you should receive reports that include NOI, GSR, expenses, rent rolls, delinquency, unit count/mix, market trends, vacancy and time on market, marketing plans and comp surveys. You should also request information regarding the physical structure to include maintenance logs, contracts, warranties and current condition report. Inspect the unit interiors, basements, rooftops, HVAC systems, trash rooms, elevator performance, parking structures, everything from soup to nuts.
It may be beneficial to take a property manager and/or building engineer with you depending on the size and age of the property. Another idea is to ask a property manager to “shop” the building before your inspection, to evaluate the day to day operations.
I’ve personally been involved in investment property acquisitions; I have inspected and been inspected. Please feel free to contact me with any questions or concerns that you may have.
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