Tips for Buying Commercial Real Estate Out of State
A wonderful thing about buying a commercial property is that you don't have to be bound by where you live. You can buy property in another state. However, just how smooth the process goes has a lot to do with how prepared you are. Here are a handful of tips to get you started.
Understand Affordability
It's important to understand affordability when it comes to buying real estate property in another state. In terms of affordability, dollars don't transfer at the same rate from state-to-state. For instance, someone who lives in Missouri that has $750,000 to invest in property, will discover that their money will buy far less property in a coastal state like Florida. When you think about how much you can afford to spend, you should also think about the area where you plan to purchase.
Learn the Law
It's a good idea to learn the law as it pertains to commercial real estate in the area where you plan to purchase, especially when it comes to zoning. Local governments typically zone areas based on established businesses. In the event your business might infringe on other businesses in the area, you might need to have the property rezoned. How easily this rezoning process varies widely from state-to-state. Having at least a general idea of what the process is like is helpful so that you know what is up ahead.
Clear Your Schedule
Ensure you clear up some time in your schedule to go back-in-forth. It's never a good idea to purchase a property sight unseen. You want to see the property yourself, as well as the area around the property. Keep in mind; if you partner with a commercial real estate professional, he or she will do a great job keeping you informed so that you don't have to make several trips, but it's still a good idea to leave room to travel to the area.
Leave Extra Room
Make certain you look for a property that has some extra room. For instance, if you purchase property to build an office complex for several businesses, the property should be large enough to also leave room for a management office. After all, since you won't be in the area, you will need to have someone on-site to handle the day-to-day tasks of managing the property. Finding a location with a little extra space leaves room for this extra office.
When you purchase commercial property outside your local area, consider partnering with services such as 502 Business Park.
