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Purchasing your first commercial property

Your First Commercial Property Purchase


Things to consider when purchasing your first commercial property:

01 — What types of property interest you?
Property types:
• Industrial
• Office
• Retail
• Multifamily
• Hospitality

02 — How involved do you want to be?
Active or passive investor:
• Land development
• Land banking
• Value-add or stabilized
• Long-term hold

03 — What rate of return are you looking for?
Return on investment (ROI):
• Capitalization rate (Cap rate) — rate of return on an investment property based on the income it’s expected to generate but does not take debt/financing into consideration
• Cash on cash — cash income earned on cash invested in a property while taking debt/financing into consideration

04 — What does the purchase process look like?
What to expect:
Inventory level
• Due diligence items/timeframes
• Earnest money
• Ability to move quickly
• Leases of current tenants
Zoning

05 — Who should you be working with?
Establish your team:
• Commercial lender
• Attorney
• Contractor
• Property manager
Commercial real estate broker

The team at GLD Commercial is here to assist you in purchasing your first commercial property.