Post- Covid, co-working segment in the commercial office real estate has emerged as an attractive asset claass that is eliciting investor interest due to its peak demand . In the current scenario, one can take advantage of the revival in demand for office space. There is renewed interest to own commercial real estate in the NCR region, which is likely to grow further at a brisk pace. The high rental yield that one can get is the biggest attraction for investing in commercial property. Moreover, there is no worry for the maintenance as it is taken care by the developer or a professional agency. Locating a tenant for a commercial property is easy and simple. In addition, commercial real estate has longer duration rental agreements from a minimum of three years to as long as up to nine years. As the businesses today require security and stability , a fixed office address for a longer period of time comes handy for this purpose. This also makes sure the protected rental income for a period of time. However, capital appreciation for a commercial property is usually slower than that for a residential one.
Here are some tips to consider while buying a commercial property .
Inspection of the neighbourhood
When looking for a commercial office property, location is crucial as there might be certain areas that are more affected by the economic downturn. Go for a property which is located in an area which has well developed neigbourhood ,has robust physical and social infrastructure along with excellent connectivity in order to reap optimum benefits of the commercial property through rental and capital appreciation.
Complete research of the area
The significant part of buying a commercial property is to do a thorough research of the area . Look into the long-term prospects of the area/location where you are considering to buy the property. Find out about the future real estate and infrastructure developments planned in and around the area that you have zeroed on. Also look for any hindrances / barriers to growth in that area. Spending a good amount of time on doing research on the location that suits your needs, will help you reap good benefits.
Always go for commercial spaces that provide user-friendly services such as parking, lift, security, etc. If the property is located near to any means of public transport, such as a a metro, train station, or a bus terminal, it significantly adds to attractiveness of the property , ensuring good returns on investment.
Plan out on the expense and how you’ll be financing your property purchase. Study the market religiously and remain patient. Make yourself completely aware of the investment opportunities before taking a plunge in order to reap the real rewards of investment.
Hence, investing your time and effort is crucial in order to understand the criteria of investment in commercial property and then you can significantly gain from it.
Viineet Chellani, Founder & Director, Jai Guruji Asset Deals