If you own a commercial property and rent it out to businesses, you need to make sure that you can maximize your residual income and your profits by keeping on top of the maintenance. If you have a regular contractor carrying out the inspections and the repairs, you are in a better position. However, there are some situations when a complete remodelling is needed, and you need to invest in your property to make more money off it long term. Below you can read about more when you need to pay more attention to the condition of your building.
1. Your Tenants Moved Out
If you are planning to find another business to move in the commercial property, you might want to give the shop or office a complete overhaul. Apart from the regular painting and decorating, jobs, you will need to address some of the issues you couldn’t while the building was occupied. Remove all the signs of the previous business and make the front of the building more appealing to new prospective tenants. Think through which type of business you would like to have in your real estate, and tailor it to their needs.
2. There are Health Risks
If there is mold or cracks in the wall, maybe the electrical system is failing regularly, you will need to pay attention to the building. Arrange a suitable time with your contractor and the company and carry out the repairs. If there is mold in the toilets and kitchen, or a leak is causing dampness, you could be sued for not looking after the health of people working there. Avoid lawsuits and check your contract to find out what is your responsibility as a property owner.
3. Injury Hazards
Loose floorboards and tiles can cause accidents. During your inspections, ask your contractor to carry out a safety hazard assessment, so you can avoid lengthy and expensive lawsuits and protect your reputation as a real estate investor. If you would like to find out what measures you need to take to protect your tenants, you could contact an injury lawyer for a free consultation. Remember that prevention is always better than trying to deal with accidents and disasters.
If your tenants are not feeling safe and protected in your property, you might need to invest in security. In case there have been break ins and the business renting the property suffered loss, it is your responsibility to step up your game and install security equipment. A CCTV system costs less than you would think, and installing bars on ground floor windows can deter intruders. Reinforce the doors and windows, and ask a security company to complete a full assessment to find the greatest vulnerabilities of your real estate.
5. You Want to Increase Your Price
Sometimes you simply want to increase your residual income, and you need to justify the rise of the rental price by improving the facilities in the building. From adding a modern kitchenette to replacing the windows or floors, there are several ways you can improve the life of the employees working in the property. Improving the lighting, modernizing the looks of the rooms, and adding parking can all help you add value and justify your new price.
6. You Want to Break Down the Property to Smaller Units
In some cases, you do the maths, and you decide that there is a limited supply of commercial talents who need the size of space you are offering. The good news is that you can split the existing, larger unit into smaller properties in a cost-effective way, using plasterboard. While you might need to apply for a separate water, heating, and electricity meter for all of the new properties, you can increase your profit and find tenants easier.
7. Your Electricity Bills are Too High
In some cases, your property will have an outdated electrical system, and you might be paying too much. Regular faults and flipped fuses indicate that a rewiring might be due. You will need to talk to an electrical contractor to find out how long the process will take. Talk to the business renting the commercial real estate, to find out when it is the most convenient for them to suspend their operation for a few days. You can, in turn, benefit from lower bills. If your tenants are responsible for their bill, they will appreciate your care.
8. HVAC Issues
If your tenants are complaining that they cannot get their heating and air conditioning right, you will need to send a HVAC professional to inspect the system. Today you can get a ductless system installed in just a few days, and this will improve your property’s value, as well as the comfort of your tenants. Looking after the heating and air conditioning system in your commercial unit is your responsibility, as a property owner. Get it checked regularly, and install a new system if recommended by the engineer.
9. To Sell Up
If your circumstances have changed, and you would like to move on to another property, or use the money for other investments, you might sell the commercial real estate. It is important to maximize your profits, therefore, a full renovation is needed. Get a structural assessment completed, and finish the remodelling according to the needs of your potential buyers. Sometimes a simple painting and decorating job will do it, but in other cases, installing a new heating system or changing the windows, improving the insulation can significantly improve your selling price.
Whether you are looking to make the most out of your commercial real estate investments or sell the property for profits, you will need to make sure that the building is safe and appealing. Keep your tenants happy by listening to their concerns related to safety and health issues, and improve the energy efficiency of the building to protect the value of your investment. Go beyond the regulations, and check what responsibilities you have towards the businesses you rent the building out before you start your renovation project.