Should you Buy an Existing Property, or Buy Land and Build Your Own?
When looking for the right commercial property for your new business, you’ll hear all about the importance of location—but should you choose a structure that’s already in place where you want it, or buy land and build your own?
As with so many things in business, the answer is, “It depends.” Time to get out the old pros and cons list and consider your individual needs.
The biggest advantage of buying an already established building is that it’s, well… already established. Your future customers already know it’s there, and may be eager to find out what new business will occupy the empty space.
Becoming a part of an existing shopping center or commercial development can have a number of benefits, including good visibility, plenty of parking, and ease of ingress and egress. Large anchor tenants like Lowes or Walmart create steady, high-volume traffic, and even smaller boutiques and restaurants will have loyal customers who are likely to wander over to check out your business just because it’s next door.
Buying an existing building can also mean taking on pre-existing problems. Inspections should catch glaring issues such as toxic mold or a cracked foundation, but it takes regular, daily use of a space to discover you have a sink that easily clogs or an air conditioner that conks out whenever the temperature creeps over 90 degrees.
You also have to consider the cost of bringing an old space up to date. For example, the fresh air we get from modern ventilation systems is easy to take for granted until you start working in a space with an older system, and an old building might not be up to code when it comes to providing access for the disabled.
Shiny and New
When you construct your own space, you have the comfort of knowing that everything from the roof to the flooring is brand new and in top condition—no surprises. You can also design your building according to your own vision, making sure it suits you both aesthetically and practically. Instead of tearing out a previous tenants’ tacky lighting fixtures, outdated kitchen equipment, or unwanted cubicle partitions, you build exactly what you want from scratch.
Consider the Cost
Building new means you create only the space you need—no more, no less—designed to function for your exact business. This can save you quite a bit when it comes to efficiency, reducing your utility bills and increasing your day-to- day productivity.
On the other hand, building new has a multitude of semi-hidden costs that must be considered, from building permits, to design fees, to contractors that may go over budget.
If you’re still uncertain whether you want to move into an existing property, or buy land and build your own, consult a professional. An experienced commercial real estate agent can guide you through the pros and cons as they apply to your specific business and area.