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Gain valuable insights from experts on commercial property valuations
Learn from commercial real estate experts on how to maximise your investment returns through commercial property valuations.
Why are commercial property valuations important?
Whether you are a first-time commercial property investor or a more experienced one, navigating the commercial real estate market can be tricky. One crucial factor that investors need to fulfil before investing in a commercial property is to measure how much it's worth.
The valuation of a commercial property is crucial for potential investors to carry out due diligence based on various factors. For inexperienced investors, hiring a commercial property expert is highly recommended to guide them in making smart investing decisions.
That said, here are several factors that you should consider when valuing a commercial property’s worth. This is to ensure that you are getting your money’s worth and rack in extra passive income from closing your commercial property deal.
Factors that affect commercial property valuations
1. Local economic trends
Shifting economic trends and patterns are something beyond the control of an individual investor. So, timing is important when it comes to commercial property investment. It's advisable for investors to make a purchase when there is an economic boom, where employment, salary levels and the labour market are on the rise. This ensures the value of your property will continue to rise in the future.
Get in touch with a commercial buyer’s agent to better understand shifting economic patterns.
2. Location of the property
Buying a commercial property in an area that has good connectivity, public infrastructure, amenities, and proximity to important landmarks can be profitable for the buyer long term.
You should also research extensively on other neighbourhood-specific factors in the area, such as the crime rate, traffic count, and occupancy rates of commercial properties. Areas with high occupancy rates tend to attract better economic activity, which can be incredibly lucrative for the buyer too.
3. The property’s condition
The condition of the commercial property will largely affect its closing price. If the property has issues such as broken HVAC systems, leaking ceilings, or peeling wallpaper, these could decrease the overall value of the property. Moreover, sellers may not refurbish the property for prospective buyers.
Enlisting the help of a commercial property expert can help calculate the cost of repair and find the most affordable and effective solutions for fixing issues within a commercial property.
4. Demand for the commercial property
If you invest in a commercial property that does not comply or keep up with local market demands, there is a high chance that it might not appreciate in value when you try to resell it and you will find it difficult to generate positive cashflow.
For instance, if an office building you invest in does not offer many facilities or sufficient space for modern-day tenants, they will be looking for a property that fulfils that criterion. So, pick and choose your commercial property wisely.
Why work with Unikorn
Many Australians don't realise how easy it can be to invest in commercial properties, so they miss out on the awesome benefits—higher rental yields, longer lease contracts, and net positive cashflow—these properties can offer them.
Unikorn helps you succeed in commercial property investment with our team of property experts providing property investment education and guiding you through the investment process every step of the way, taking away the confusion and helping you multiply your wealth.
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Need guidance for valuing a commercial property’s worth? Our experts can help you!
FAQs
To increase the value of a commercial property, consider applying the following measures:
- Strategic renovations
- Maintaining areas of the property that are deteriorating
- Improving the overall attractiveness of the property
The following factors are taken into consideration when valuing a commercial property:
- Location of property
- Type of property
- Complexity of property valuation
It's recommended that you get a quotation from several appraisers and valuation companies.
Helen Tarrant, a property expert with more than 10 years of experience will show you the ropes to making educated decisions in commercial property investing.
Book a strategy session with us, today! Click here