As the demand for commercial rental space increases in Vancouver, many people are looking to cash in on the lucrative sector. For the best experience, one needs to address a few crucial factors that lead to a smooth investing experience.
Riding on emerging technology, Vancouver is among the cities with the lowest vacancy rates in the commercial space. As of 2017, the vacancy rates were down to 6.8 per cent, down from 8.3 per cent reported in 2016. With the prices projected to come down to at least 3 per cent in 2019, the sector is ripe for anyone looking to cash in. For the best results, however, vancouverbusinessbrokers.ca stresses that you need to avoid the following costly pitfalls:
Vet your prospects thoroughly
Consistency is the secret ingredient that drives profitability in the commercial real estate. In a nutshell, the calibre of your tenants has a direct impact on your monthly income. The last thing you need is a problematic client who is consistently late with his or her rent.
Carry a thorough background check on your prospects long before you ink any dealings. Otherwise, you might have to incur additional expenses in the form of legal fees as you seek to compel them to pay your dues.
One considerable advantage of commercial rental space is the ability to get into long lease contracts. In most cases, business rental contracts are longer than three years, with some extending to as many as 25 years.
Lengthier contracts are more profitable as they translate into low vacancy rates and provide consistent income across the years. It means that you spend little to no effort making your property, as it is nearly always full. For the best results, you need to figure out the strategy before making a purchase.
Vancouver is rapidly morphing into a technological hub, leading to some of the lowest vacancies in the commercial rental spaces. Taking these precautions when looking to venture into the sector ensures a smooth experience all the way.