The primary concern when buying an office property is cost — even if you can afford the price and mortgage payments, do the costs pencil, considering the building’s quality and features? While a low price may look attractive to buyers with limited capital, consider the costs of any improvements necessary to make the property useful to potential tenants. A cheaper building may, in the long run, cost far more than a larger initial investment in a higher-class asset.
At the same time, it may not be the best idea to splurge on the property that has the most features. There’s little sense in paying more money for something you or your tenants may not have any use for. Does it make sense to pay more for an office building with a slightly dated fitness center, or less for a property located near a retail center with a state-of-the-art gym? Consider your actual needs carefully.
Once you have determined what you need from the property, you can then begin the search. Keep in mind that you may not always be able to find the “perfect” investment opportunity. However, identifying your needs is crucial to select the building that most closely fits your needs in the context of your budget.
Where your office property is located is extremely important. At a minimum, a property should ideally be accessible without any major issues for employees, customers, and clients. Beyond this, you should consider the security of the surrounding area. If a property is in an unsafe area, you may want to think twice — even if a building is well maintained, has some nice features, and is within your price range. After all, if it’s not in a good area, this could affect future valuation, not to mention leave a poor first impression on customers.
Additionally, you should consider the services near the office asset. Though it may not have a direct impact on a tenant’s business, a location near restaurants, shops, and services like gyms or dry cleaners could be a selling point.