After hours of research, you’ve finally committed to the idea of investing in commercial real estate in Philadelphia, PA. But how exactly do you go about doing so?
Investing in commercial real estate is a little different than residential. Often, investing in commercial real estate involves longer lease terms, more qualified tenants, and higher returns.
Big businesses and corporations are common tenants of commercial properties. As a result, doing business with these larger financial entities raises your returns and builds your commercial property’s cash flow.
But investing in commercial real estate is not without its risks. Here are the steps you should follow if you’re planning on purchasing commercial real estate property in Philadelphia, PA.
Why do you want to invest in commercial real estate in the first place? Is it the high income potential? The tax benefits? The plentiful, yet riskier investment opportunities?
If you’re completely and totally green to the world of commercial real estate investing, you may want to slow down and self-educate before you start contacting listing agents of commercial properties. The worst thing you can do for yourself at this point in time in your game is lock yourself into a bad deal you can’t get out of.
Once you solidify your “why” and feel educated enough to proceed, you’ll be ready to move onto the next step.
In commercial real estate, there are several types of properties:
Take the time to research each one and figure out which property types appeal the most to your own interests. Maybe you like the idea of investing in multifamily properties that house hundreds of families; maybe you like the idea of an office space that could be the potential home for America’s next corporate conglomerate.
Either way, figuring out which types of properties interest you the most is imperative to starting out on your commercial real estate investing journey.
You can use MyEListing’s search engine to research and examine all the possible commercial real estate investment opportunities in Philadelphia, PA that you can find. Each listing illustrates important information about the property, such as:
Many of Philadelphia, PA’s suburban counties are located close to airports, highways, ports, and railroads. This provides both you and potential customers with easy access to commercial properties as well as numerous markets, expanding the potential for growth.
This is why location is so important in the world of real estate investing. Choose a commercial property that’s conveniently located close to local marketplaces and centers of activity to make it easier for your potential tenants to experience the local neighborhoods and enjoy living and/or working in your property.
This is easily accomplished when you choose to invest in the real estate market that Philadelphia, PA has to offer. Popular attractions like Rittenhouse Square Park, the Franklin Institute, Spruce Street Harbor Park, and Center City Philadelphia in general are, more likely than not, close by to the commercial properties you’re looking at in Philadelphia and its surrounding suburbs.
The next and final step in purchasing commercial real estate property in Philadelphia, PA is contacting the listing agents of the properties that you’ve chosen. From here, you’ll work out the terms and conditions of the deal as well as set clear expectations for all parties involved.
It is in this final step of the process that you want to ask as many questions as possible about the property, communicate clearly all of your wants and needs, and be clear on how you plan to communicate with the listing agent throughout the negotiation process.
If you can and if your selected properties allow it, try to work with only one agent. Most agents may expect exclusivity when working with them. If this is the case, do not contact other agents. If you see another commercial real estate property in Philadelphia, PA that you’d like to see, do not contact the listing agent of that property, but rather the agent you’re currently doing business with.
Working with multiple agents may not only breach the contract you have with your current one, but can quickly produce confusion and may become overwhelming.
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