Considerations Before Buying Commercial Property

Commercial PropertyThere is an enormous difference between investing in residential and commercial properties. Commercial real estate includes high investment but, it also gives higher returns in the long run. It is highly important that you carry out a complete study about all the fundamentals occupied in commercial property purchase before finally closing the deal. Below are some considerations before buying commercial property.


The very first and prime thing to think is the location of the property. The more outstanding the location is, the higher is the investment involved. Leading real estate locations attract higher number of tenants. Make sure that the location should be conveniently located and has easy access of road, transport and is in close proximity to multiplexes, restaurants, other commercial areas and popular hangouts etc.

For example: WTC Chandigarh Aerocity

Viridian Red Group is launching a commercial project – WTC Chandigarh Aerocity, Mohali. The commercial space in WTC enjoys high returns and better capital appreciation. WTC across the globe has demonstrated 33% more occupancy and 18% higher rentals.There is also a sense of security along with pride of ownership considering its legacy and association with fortune 500 companies. Quality will match the best in international standards. The international airport and railway station will be 5 minutes from its location and city center is just 15 minutes. Chandigarh is considered as 1st in human development index and 7th among top 50 IT outsourcing destination globally. 97% of people live in urban area.

Value evaluation:

Check the value of commercial properties in the neighborhood and compare it with the property you want to purchase. Collect all right information on rents and values, which will help you bargain properly with the seller.

Safety values:

It is highly essential that you need to check all the safety measures before closing the deal. So check all plumbing, electrical and other stuffs like walls, roofs, etc. Make repairs where needed to avoid future dangers. Also install some Fire Extinguisher and get appropriate covers for all such instruments.


Whether you are setting up to use the entire space for yourself or rent it out to other tenants, you need to make sure it provides all the basic and standard office facilities and everything is in proper working state. Once all the checks are done, then only go for  closing your deal without any hassles.

Maintenance charge

The maintenance cost for a commercial property is little higher as compared to residential properties. Study what amenities you will be getting and how you will be charged for them. If you are purchasing to rent it out to other tenants, check on how you will be able to charge them. If you find the deal profitable, you can go for it.

Apart from the cost of the property, repairing costs and maintenance costs, there are other hidden costs like insurance, property tax and other surprise costs that may arise in the upcoming days. Make sure you have sufficient to pay for all of it. Calculate your annual income after deducting all these costs and prepare a reference balance sheet for yourself. So you can check if you are going in for a profitable deal/not.

commercial property


If you are purchasing to rent it out to other tenants, you should be very cautious. Revise properly the agreements made by the tenants who are previously present and check what period they are present for. Read all the instructions related to renewal of agreements or relieving of the tenants. Check background of your tenants. Calculate the vacancy ratio of the property for ten years. Hire a property lawyer to assist you completely. If you think you are not satisfied with the old renting documents, create a new set of agreements and make sure the tenants obey with them.

Also, be sure to read all the documents of the property and transfer of ownership properly to avoid inconvenience later on.

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