Making sure your investments are as profitable as possible is always a challenge, and managing a portfolio of commercial properties might be one of the hardest, but the rewards it can bring to the savvy investor are great, so here are some essential things to bear in mind.
Costs
It’s worth remembering that the price of a property isn’t the only money you’ll be investing in it. If you plan on selling it on at a profit, renovation or development will be needed to bring up the value, and if you plan to recoup your investment by putting the property up for rent then you will be responsible for its upkeep.
If you have a large and diverse portfolio all over the country—or even the world—this might mean you will need to hire on-site managers who can attend to such matters promptly for you. This is yet another expense to account for as you expand, but it will save you many a headache in the long run as long as you account for it from the beginning.
Estate Agency
A second opinion can be invaluable, and sourcing commercial properties can be difficult, so an essential first step is to find a good estate agent who specialises in commercial holdings, such as GVA , to help you manage your portfolio.
An experienced eye can help you to identify growth areas that are more likely to yield high pay outs in the future, as well as which properties are likely to offer the highest profit compared to development costs. This makes their input especially valuable to inexperienced investors, but a long working relationship with a trusted agency is something many old hands in this field will tell you is an absolute must, so don’t think you’ll ever reach the point where they can’t help you anymore.
Location
Area has a huge impact on property prices, which means that if you want to recoup a significant profit from your investments, it’s a factor you can’t afford to ignore.
This should affect your property buying and selling decisions in two ways. Firstly, you should pay attention to overall prices for an area, and any trends—it will be more worth your while to buy in areas with high profit margins or where prices are steadily on the rise. Secondly, you will want to diversify your portfolio in terms of location, so that if any unforeseen circumstances bring prices down in one area, you will still have a bevy of other investments to rely on.