Thinking about leasing, buying, or selling commercial property in Southeast Louisiana?
There’s more to evaluating commercial real estate than just square footage.
Whether you’re a tenant looking for space, an owner considering a sale, or an investor evaluating a property, several factors can affect the property’s suitability, cost, and potential.
What Should You Consider When Evaluating Commercial Property?
Location & Market Trends
Understand the area and how it is evolving. Population growth, new development, infrastructure, traffic patterns, and other market factors can influence the long-term appeal and potential of a property.
Property Condition & Layout
Consider whether the property’s condition and layout meet your operational needs. The amount and type of improvements required can affect both the cost and functionality of a space.
Lease Terms & Flexibility
For tenants, understanding the length of the lease, renewal options, termination provisions, and other terms is important when evaluating a commercial space. Flexibility can also be an important consideration as business needs change.
Investment Potential
For buyers and investors, consider both the property’s current income and its potential future performance. Factors such as rental income, operating expenses, market conditions, and potential resale value can all play a role.
Tenant Mix & Competition
For retail and other customer-facing properties, consider who else operates in the area and how nearby businesses may affect traffic, demand, and competition. For investors, the tenant mix can also be an important part of evaluating a property’s income potential.
Why Does Commercial Property Evaluation Matter?
Two properties with similar square footage can have very different costs, opportunities, and risks depending on their location, condition, lease structure, and surrounding market.
Taking the time to evaluate the property from multiple perspectives can help buyers, sellers, investors, and tenants better understand the property and the opportunity before making a decision.
Ask a Broker
With decades of experience in office, industrial, and investment properties, David da Cunha works with clients ranging from tenants to investors throughout Southeast Louisiana.
Have a question about commercial real estate? Contact David to learn more.
