Investment
Welcome to your free source for Commercial Real Estate in Ontario, Canada.
We provide following services:
- Sales and Leasing Industrial, Retail and Office Buildings
- Sales of Hotels, Motels, Gas Stations, Retirement Homes, Banquet Halls
- Sales of Other Businesses
- Consulting and Advisory Service
- Opinion on the Values of Properties
- Turnkey Projects - From Acquisition of Land to design built
In today's commercial real estate market, return on your investment is very important. Many good commercial properties are bought and sold before they are even advertised. Many of these listings are not on MLS (Multiple Listing Service) with a particular real estate board and are available on exclusive basis.
If you are looking for a good deal which will increase your net worth on a long-term basis, then please contact me. If you own a commercial property that you're thinking of selling, I would be more than happy to provide you with best advice and some extremely important suggestions.
How To Pay Right Price for Your Real Estate Investment Property
Whether you are buying your first property, or your fifth, the process of buying a real estate property is a detailed, time-consuming venture. At the same time, it’s an emotional period laden with difficult choices. You want
to ensure that the property you purchase meets your investment goals and objectives now, and in the future.
Each of these decisions often involves money. When you consider all that money represents, you’ll want to ensure that you don’t pay too much. This article helps you become a savvy buyer, by pointing out some of the pitfalls inherent in the investment property - buying process. These include such things as knowing what you want before you begin process, taking your time to analyze, choosing the right commercial real estate professional, and remaining objective while viewing potential investment properties. With this information, you’ll be closer to finding
your right investment.
1. Before you start looking the investment properties, develop a criteria and strategy
Everyone has an idea of investment in real estate. Investment means return on your investment. What kind of return are you looking for? Are they realistic? The returm on your investment means Capitalization Rate (in short Cap Rate).
Basically, a cap rate is defined as a return on your investment in a no financing scenario as if you are buying the property with no financing on it. the Cap Rate is defined as net Operating Income divided by price of the property you are willing to pay. Therefore, the Net Operating Income (NOI) generated by the property plays a very important role in determining the offer price. To calculate the true Net Operating Income you may like to normalize the Income Statement of the property by taking all the expenses such as property management, maintenance,
legal and accounting. Sometimes some of these expenses are hidden which gives an over-stated Net Operating Income (NOI) and Cap Rate. At this point a Buyer is willing to pay more price for the property than it should. But should the buyer pay a higher price than the market value?
That’s why it’s a good idea to develop a good relations with an experienced and dedicated commercial real estate professional who can analyze the property and pin point various things in the analysis.
