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Commercial Real Estate Denver Investment Opportunities

June 27, 2018

The real estate market has ebbs and flows much like the New York Stock Exchange but knowing both when to invest and what properties to take under consideration can make all of the difference in your financial portfolio. Similar to being aware as to which stocks will eventually end up giving an investor their biggest return on a profit, the real estate market can do almost the exact same thing if properly orchestrated creating monetary benefits for an individual’s pocketbook and bank accounts.

While this can be a stressful endeavor, it can also be an amazing experience and one that if properly executed will have lasting benefits. A variety of measures must be considered when deciding which properties to undertake as a potential real estate investment but when these things are considered and the money is readily available, then creating a serviceable market for a potential business becomes a reality.

Much like any other profession there will be highs and lows as not every piece of real estate will be a home run, stringing together more positives than negatives is key to a sustained relationship within the world of real estate. These successful opportunities help to keep an investor on the right track and shortcomings, though hopefully few and far between, should be utilized and learned from for future corrections.

Similar to residential real estate, the commercial market carries many of the same qualifying factors when deciding whether or not a potential property is worth the time and money for an investment. There are a number of factors to consider but these few critical components are shared by both worlds of investing.

Property Location

Location, location, location - often the high point of real estate and depending on the status of a property and location can be a qualifying factor in and of itself regardless of the physical condition. If a property is in a prime spot for potential business opportunities or otherwise creating a necessary function for investment then often the physical state of a building can be overlooked in order to justify purchase.

Locating a prime piece of real estate for commercial functionality also means taking into consideration the different options a building may provide for a future investor. If you are looking solely at renovating and flipping a property for profit, then the location must be instrumental in helping to provide an ample amount of business opportunities for future buyers.

If so, then considering the neighboring businesses and market will be important to deciding if the return on investment would be beneficial. For instance, if a fast-food restaurant has gone out of business and the building remains vacant but two or three other, more prominent, businesses have recently moved into the neighborhood then location may not be the first and foremost important aspect when considering an investment.

Perhaps the more recent additions of other similar type establishments caused the primary business to suffer, creating the closure. For this reason, even if the building was once in the perfect spot for operation, taking a chance that one could purchased and renovate the property with intentions of another similar business taking over ownership in the future may not be the best idea.

However, if you can change the intended purpose of a building during a renovation process then the location could be a key factor in selling the property later and creating a good return on your investment.

Tax Evaluation and Appraisal

The tax bill for any piece of real estate is a “behind the scenes” type of expense which must be considered when determining the potential investment benefits of a piece of real estate. While buyers are likely to consider the tax implications because values are often based in or around these figures, knowing them up front for investment purposes is critical.

It remains possible to have a property reassessed for tax value purposes but the process can be daunting. Depending on the timeline for flipping an investment, knowing the evaluation before hand and ensuring it will not change much should be considered.

Appraisal prices are also a key component of the real estate market as any property that is changing hands is often subject to an appraisal. During this step, an outside agency visits the site and determines the overall market value for the structure at present time.

Appraisers take into consideration many different factors, like location, age, safety and shape of a property as well as the current market conditions. The simple principle of supply and demand is appropriately fitting here as industrial and business buildings may not be readily available in a certain area, increasing the overall value of these types of structures for potential investors and buyers.

Bottom Line

The absolute lowest available price for a piece of real estate at which one would sell their property and also the final outcome of an event. Both meanings described in layman’s terms and appropriately inserted here into the real estate investment market.

Each presents a unique factor for consideration when determining if investing is the right option on a particular structure. Obviously, the bottom line for a seller will be important as an investor while also considering what the same number will be once renovations and improvements have been made. Knowing that an increase is expected and will be worth all of the initial process is vital to making sure you are making money over the long haul.

This entire process also is important to consider the end result or bottom line’s other definition. Ultimately, being able to accurately project the future of a transaction and investment will help in establishing a consistent means of income from flipping real estate on the commercial market.

If you are considering investments within any commercial property type divisions, are in need of a hard money lender, or are ready to move forward with a contact, then come see the experts at COHI Capital Private Equity Lending who can help you determine and analyze your individual needs. After their free consultation, quality experts can offer meaningful advice and help to set up a beneficial plan immediately for all involved parties in order to achieve the goals of everyone involved in the process. Whether the monies will be needed for refinancing or outright purchase, the best plan available will be applied specifically to your application. They will decide what type of loan will work best for you drawing on experience and benefits of finding successful funding needs for over a decade. A full detailed review of your situation can be completed in addition to resolution issues and monetary considerations. Request some additional information by contacting COHI today. Call 970-922-3277 or contact us for a decision. Often these are made the same day and can be addressed depending on client needs and schedule.