How to Evaluate Commercial Real Estate

admin June 10, 2013 19 Comments

Finding commercial real estate calgary for sale can be a boon to commercial real estate investors, but sometimes it takes some analysis to sort the deals from the dogs. Frequently Calgary commercial real estate brokers can give you inside edge to find a great deal, but you should also understand what makes commercial property for sale Calgary a valuable investment.

Commerical real estate companies Calgary will tell you that you can gain additional cash flow and volume benefits by investing in Calgary commercial real estate for lease. In fact, most commercial real estate companies Calgary see a larger profit from their commercial real estate Calgary.

There is a definite upside to investing in commercial properties. For one, they have longer leases than a single family residence might have. They also have potentially more tenants so that all square footage is maximized through rents. Finally, most commercial real estate Calgary has a built in exit strategy. That means that with a decent rental rate, you might easily sell your commercial real estate Calgary.

Evaluating properties is a little different than individual rental properties. You will usually have to put around 30 percent down for typical commercial mortgages. Like residential properties though, you can find motivated sellers. Those are the sellers that will part with their property at a reduced price based on their individual situation and current cash needs.

You can evaluate commercial real estate Calgary by visiting and studying the neighborhood. Look at the other properties and talk to owners. This may help you uncover trends that could affect future leases or potential deals that have yet to be advertised to a broader audience.

Also, when buying commercial real estate Calgary, you can look at the cash on cash returns. This allows you to compare first year performance on competing properties to ascertain which might really provide more income. To determine the cash on cash return you should evaluate the initial cost of the investment and predicted returns for your commercial real estate Calgary.