Tips for Purchasing Commercial Property in Brisbane

 

  1. If this is the first time investing in commercial property in Brisbane, bear in mind that securing a commercial property loan is harder than the residential sector. When applying for a commercial property loan, banks or lending institutions will look into it more closely and take more time studying your application. Generally, they will only lend up to 70% on average so you’re most likely going to need a larger deposit than what you would for a residential property. Be sure you (and your partners if you’ve got them) have the ability to cover the large deposit required, and shop around to find the lender best suited to your requirements.
  2. Make an educated decision as to which type of commercial property to buy in Brisbane.
  3. Office suites in Brisbane yield the lowest return but are usually a safer investment because renters are more likely to sign a longer lease.
  4. Retail spaces – the location is highly important when it comes to securing a tenant. If your store is not easily available and in a high traffic location, tenants might not find much trade and as a result may not be able to maintain the lease.
  5. Industrial commercial property in Brisbane generally has a much higher yield but the threat of vacancy is also higher.
  6. If you’re looking to purchase a retail spot in a shopping center, it is a good idea to buy a space as close to the anchor tenant as you can. The anchor tenant is the largest shop in the center and as this is the major draw card for shoppers. The closer you are to the main store, the more visitors you will probably get on your door.
  7. If you’re wanting to buy a commercial property in Brisbane that contains more than 1 unit or store, consider buying as many of those as you can. Doing this means your return on investment is likely to be much greater. Along with this, if one unit is empty you might still receive income from another unit/s.
  8. It’s strongly suggested to have some additional funds to serve as a buffer for the loan payments if your commercial investment property encounters any long-term vacancy.
  9. Organise pest or building inspections: buying commercial property in Brisbane is a huge investment. If you’re renting out the property, you’ll be responsible for any problems about the structure of the building, so why don’t you acquire peace of mind before purchase, ensuring there are no significant structural defects in existence and that the construction complies with commercial construction regulations. It’s a great idea to organise a pest and building inspection before signing contracts, and it is advised that you select an organisation that specialise in commercial property inspections.
  10. Besides pest and building inspection reports, think about adding a due diligence clause in your contract. This would enable sufficient time and permission to make enquiries into any problems which could affect the value of the commercial property you’re contemplating purchasing. Issues could include: compliance with planning laws, status of lease and tenancies if the building is occupied and there is potential contamination of the property or surrounding areas.
  11. In the event you and the seller make a deal around any problem with the property or any special conditions related to the sale, it’s very important that this is written into the purchase contract. This is required by law and will protect you if any associated problems arise in the future. Buying commercial property in Brisbane as an investment with the intention of leasing it out? Purchase a property management specialist who has expertise in the Brisbane commercial housing market. They will take the strain away from you by assessing prospective tenants, determining the right lease which takes into consideration the location/building condition/utilities etc and negotiating the finer details (such as the length of the lease and any refurbishments.)

Jeanette Newman