Increase Your Commercial Property Value in 7 Ways
You’ve probably taken a chance at investing in real estate with hopes of reaping its benefits in the long run. And, you’re right. There’s so much potential for commercial properties to increase in value over time.
As the owner, you can take advantage of this financial opportunity and the key is to be strategic—think long-term. Focus on what you can do at the moment. We’ll help you get started. Here are 7 ways to increase your commercial property value.
7 Ways to Increase Your Commercial Property Value
1. Mark Up Your Rent
The simplest way to increase the value of your property is through a rent increase. Be on the lookout for mark-up potential. Check the local market rates to figure out a reasonable price hike without breaking the bank of your tenants.
2. Renovate and Innovate: Property Makeover!
Try to be in your tenant’s shoes and ask questions like “Am I getting my money’s worth?” and “What could be improved in terms of the appearance or structure of this property?”
If your answer is somewhere along the line of a fresh coat of paint, better electrical wiring, and so forth, you will need a property makeover STAT.
Or better yet, get a clear-cut evaluation from your tenants. They can share details that you may have overlooked. There might be plumbing issues, a disgruntled roof, and so on. Not only are these a big nuisance to your tenants, it can also decrease property value.
By asking your tenants directly, you’re practically hitting two birds with one stone — you’re winning the hearts of your tenants, and it’s elevating your property’s value.
3. Minimize Your Operating Costs
Take a step back and review your historical operating expenses. Just like personal budgeting, there is almost always an item on your list that you can cross out or look for an alternative. It could be having preventative maintenance rather than repairing issues on the property at once. Another option would be to look for a local property management team who will be your boots on the ground.
To help you get another perspective, it also helps to compare other properties within the area. Get a gauge on whether your expenses are within the industry standard.
4. Explore Possibilities for Amenities
When there’s enough wiggle room for you to consider adding amenities, grab it! It’s a good way to call the attention of future tenants and retain current ones.
Make the best use of income-producing amenities such as a concierge area, coffee bar, gym/fitness centers, among others. You’re not only increasing its value years from now; you’re also adding an extra stream of income to your property.
5. Time for a Change
Look around you and check if the neighborhood is changing and if you are supposed to do the same.
Maximizing the growth potential of your property based on market demand can get a great deal of value to your investment. It may be switching from an industrial to retail space to changing hotel to the apartment. You could even zone your property across different types of space and weigh in your options.
This is, of course, a huge decision to make. It involves a lot of planning and consulting with experts.
6. Manage Property Taxes and Leases
Check with a local real estate tax analyst to assist you in property tax appeals to make sure that you’re paying a reasonable amount. It is also an excellent opportunity to determine if an appraisal is possible. In the same way, be open to exploring new leasing companies to get a new take on how you can further boost your commercial real estate property’s value.
7. Consult a Pro to Help You Grow
Making these decisions requires a huge undertaking, and it can be confusing. That’s why it’s always best to consult with professionals. They can help you see through every detail of prospect value for your commercial real estate property possible.
Are you looking for an exit strategy on your commercial property? Or are you looking for ways to generate more ROI from your commercial asset? Look for a trusted partner that you can collaborate with and find out the best way to increase your commercial property’s value. It all starts with a conversation.
