Are you looking to purchase head office commercial premises for your business? There is certainly a level of prestige to owning a business address, particularly for a mature business that doesn’t have significant fluctuations in terms of space requirements. The associated savings on commercial property rentals in the long term can be significant, provided that the investment is made in a prime location where property values are consistently improving.
Sectional title units within secure office parks are becoming an increasingly popular way of accessing the local commercial property market. This is mainly because the listed and larger private funds have made it challenging to purchase attractive freehold opportunities in blue chip locations. In these locations, existing opportunities are limited, and significant financial muscle is required to consistently make a success of commercial property acquisitions.
Most SMMEs and private businesses don’t have a responsibility to external shareholders for frequent returns, for example via dividends. In these cases, all gross profits can be reinvested back into the property holdings. These investments can even be instituted as a means of retirement or pension savings for directors and employees – which gives participants an opportunity to manage their retirement wealth on a more direct platform.
Another advantage to owner-occupiers is that commercial property holdings can be used as collateral to secure funding. This provides scope for wealth creation, particularly where lengthy, significant lease commitments are in place. Funding for commercial property transactions can be secured on long-term fixed bond rates where forward repayment terms can be accurately forecasted.
For advice on property acquisitions and funding contact Simon (083) 261 2861.