Property investment is a favourite investment strategy. Unlike investment portfolios, a property investor deals with physical and tangible assets, namely a building, a flat, a house, etc. Because the asset is “real”, entrepreneurs who want to build an additional source of income are easily tempted by the apparent advantages of the property market. However, it’s fair to say that recent regulations have made it more difficult for individual landlords to run a profitable buy-to-let side hustle.
You can, however, explore the benefits of real estates that are often ignored by prospective investors such as commercial properties. Commercial buildings can cover anything from a shop to an office via warehouses and multifamily housings. As it’s a sector that is constantly evolving, it has remained highly profitable for the investor who knows how to manage their assets:
#1. Put your business cap on
The first rule of any property investment is that you need to think of your asset as a business. Indeed, maintaining your business mindset can prevent many ill-founded decisions that could occur as a result of your emotional attachment to the property. At its core, your investment is designed to provide financial security, meaning that you need to assess each decision in terms of return on investment and potential for gain. You can’t afford to get distracted by considerations of style and sentimental value.
#2. Keep the outdoors clean
Commercial settings, especially, can be essential to a brand reputation. Indeed, clients and even future employees tend to judge the book by its cover, meaning that if the exterior of the property appears dirty or tarnished, it will affect the way they perceive the brand. Consequently, your commercial tenants expect from you to maintain the outdoors. From an overgrown front garden to the accumulation of bird stains around the property, you can be sure that a poorly managed outdoor area creates a bad impression. Hiring a gardener to look after the lawn and adding bird netting to the roof can prevent the building from appearing neglected. A great tip to make a positive first impression and limit maintenance work is to use concrete landscaping.
#3. Select a location that supports businesses
With more and more entrepreneurs launching their companies outside of London, you need to identify the best spots to purchase commercial offices. British SMEs are currently looking at places such as Brighton that has very low pollution levels. You’re likely to find marketing and creative digital agencies in this area that is renowned for its digital involvement. Ipswich is also a trendy and successful location for new businesses.
#4. Should you provide add-on services?
Last, but not least, you can boost your chances to attract long-term clients by offering additional services. In large urban areas, managed offices are extremely popular as they enable companies to make their guests and employees feel welcome. Bringing advantages such as a fully managed reception area, for instance, can give you the competitive edge you need to appeal to businesses and build a profitable portfolio.
Commercial properties offer investors the possibility to maintain a buy-to-let portfolio that remains not only profitable, but that also can keep tenants in for longer. However, just as with any investing strategy, you need to understand how to maximise your assets value.