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Hidden Leasing Costs - NJuly 2023
It is interesting to note that after salaries, the second highest business cost are the rental costs for leasing a premises. In many cases the total cost of occupancy over the term of a proposed lease, is not fully understood, or calculated.
Various additional costs such as outgoings, parking, fitout costs and make good, together with leasing incentives, are not factored into the decision making and evaluation process. Accurate budgeting will reduce risk, and save time and money.
The most appropriate financial analysis to use when considering leasing a property is to establish and compare 'whole of lease' term costs.
If you are thinking of moving, then now is a great time to plan the move, to ensure the best outcome for your business, money and reducing risk in the process. This will give you peace of mind, and the confidence to make an informed decision.
Why Invest in Commercial Property? November 2023
Sentiment - Improved market primarily in Industrial, with opportunities available
Valuation - Higher activity, increased prices, ongoing uncertainty in the Office market due to post Covid-19 impact
What has traditionally stopped private investors, with modest budgets from investing in commercial real estate? It primarily comes down to the perceived high cost of entry, perceived risk, together with the common lack of understanding around the sector’s fundamentals, and concern over losing a tenant.
In reality, the benefits of owning well leased commercial property investments are clear; secure leases (3 – 5 years), high quality tenants, fixed annual rental increases, and net rental terms. This is where the tenants are responsible for the payment of the majority of outgoings, and importantly comparatively higher returns are on offer, sometimes 5% net or higher. Entry level investment is as low as $500,000.