It’s best to steer clear of the widespread misconceptions about corporate real estate since investing in a property is a significant and consequential endeavor. Your property decisions will be pivotal to your business’s comprehensive strategy, exerting influence over its operations, financial aspects, brand image, and prospects for long-term expansion.
If you want to secure your business’s prosperity and ability to endure over time, read on as we dispel prevalent real estate myths and point you in a better financial before you consult with a real estate pro.
In part one of corporate real estate pitfalls, we discussed how corporations should handle their unneeded buildings, and when it doesn’t make sense for corporations to own property.
#3: How Do I Determine How Valuable My Property Is?
If you want to find out how much your real estate is worth, get it appraised. While this is true, and everyone will tell you this, what most people overlook is that appraisals are not the ultimate gauge of property value. Even after a reasonable appraisal, a property can be worth one amount on paper but a radically different amount on the market.
So, what determines value? Use. The perfect restaurant building on a lot near a popular highway exit will be valued differently on the market than the exact same restaurant building surrounded by eighty other restaurants — and differently from the ideal mechanic’s garage building in either place. This context will also change over the years as road construction plays out, other businesses move in and out, neighborhoods grow, and city must-sees appear and disappear.
The point is that your property is worth as much as the best possible way someone could use it. But many corporation owners get their property appraised once, write that value down in the books, and keep making decisions based on that static and outdated number. Many business owners conclude that selling their property would be a financial loss according to an appraisal — when in actuality, the property is worth much more to the right buyer because a new opportunity has arisen or been detected.
Figure out those opportunities, then figure out who’s best off capitalizing.
#4: How Should A Corporation Go About Selling Real Estate?
It’s no secret that real estate brokers put properties on the market and try to accomplish sales. However, this does not make real estate brokers your only path to selling your property. In a sense, you deserve better.
By the nature of their job, brokers can’t give you their full attention. They’re paid when sales close, but most sales don’t close. Hence, they put up enough property listings so that, even if they only close a percentage of them, they’ll make enough money to go on. There’s nothing wrong with that, but it does mean that each broker has many listings to worry about, and yours is just one.
You’re the person who cares most about selling your property, so you should be the most proactive in getting it sold. So now you’re probably thinking: “I’m not the real estate pro… What am I supposed to do?”
Think of a real estate broker as a skilled salesman you can hire. Despite how much a salesman can do, they’re still limited by the quality of the product they’re selling. If all they have to work with is raw materials and a slick turn of phrase, it’ll be flat-out harder to land a sale. But if you have put extra effort into delivering a spiffed-up, desirable product, a preset target market, and a defined use case, any decent salesman will turn that straight into money.
#5: How Do I Know If I’m Making The Right Decision?
When it comes to significant financial choices, receiving tailored guidance can be a game-changer. Take advantage of a free consultation call with a specialist in real estate, legal matters, corporate affairs, or finance. After your opportunity to discuss your specific situation and objectives, we’ll embark on creating a comprehensive plan with actionable steps for you.
