Lease or Own Your Own
One of the biggest questions that faces a new business owner is whether it would be better to lease commercial properties or buy them outright. Each method has its pros and cons, so you should choose the one that is right for you. If you're currently grappling with this question, here are some of the factors that should play into your decision. A company may want to open a store front retail space in downtown Ottawa. However, they may have questions regarding their options to lease or buy the space outright. Our suggestion to them would be to contact a local commercial property agent. When you are a business owner you do not want to take big risks, so speak to experts who can guide you down the right path with smart business choices.
This is often the factor that kills the dreams of business owners who want to own the property they operate out of. Commercial property prices, especially in large urban cities, are often prohibitively expensive for a business that is just starting out. Most banks will not trust to your future success enough to lend you millions for a property purchase, so you will have to lease for a while before you can build up their confidence in you.
What are your future plans for your business? Do you envision your eye clinic expanding into a whole medical practice with many types of doctors? Will you have to invest a lot of time and money into renovating the property in order to accommodate your business? These things can determine whether it's better to lease or buy. If you envision expansions or moves, leasing is better. If you have to renovate, better to own than lease and lose the work when you move.
The market conditions can also play into your decision. If you're setting up a business in smalltown Ontario for example, early in a neighborhood's life cycle, you can pick up commercial land for cheap and watch it appreciate. Likewise if you expect the market to take a downturn in the near future, you don't want to make a purchase and end up with an unsaleable property if you want to sell it in a few years.
And finally, you need to ask yourself how responsible you want to be for your premises. If you lease space for your new franchise, your landlord will be responsible for any repairs and maintenance on the structure. If you own it, you will. You will also be at the beck and call of any other tenants in the building. Decide how much work you're willing to do and whether you can afford the insurance on the whole building before you make your decision.
Do you still have nervous jitters and questions about leasing or buying commercial real estate? That is understandable! Try reading more info before you sign the dotted line on a commercial lease contract.