Commercial Property

Acquiring Commercial Property: Important Factors you should consider

It’s relatively easy to purchase property either as a base for your business or an investment, in Auckland, New Zealand. Owning a commercial property is a decision that should be weighed carefully. In the right circumstances, real estate is a wise investment. Here are the most important factors you should consider when purchasing commercial property for lease in Auckland, New Zealand.

Building report

A professional builder should inspect the property you intend to purchase. Just like residential properties, commercial buildings may have hidden flaws that can only be spotted by an experienced builder. After the inspection, the builder should create a comprehensive report on all the aspects of the property.

Financial approval

Make sure that the agreement for purchase and sale is subject to getting financial approval from your bank. Financial institutions are always strict in terms of the loans advanced to their customers when dealing with commercial property. That’s the reason you should consult your bank before signing the purchase and selling agreements involving commercial property.

Land Information Memorandum (LIM) report

The LIM report indicates whether the property was constructed in accordance with any council permits. It also provides information about any anticipated development of the property. The information will help you make a purchase decision especially if you intend to set up another building on the land.

Other important aspects of LIM report you should consider include;

The land’s zoning: Whether you intend to hire or purchase the property, make sure that all the commercial activities you want to run on the land are allowed by the council.

The Building Warrant of Fitness: This statement is issued by the property owner confirming all the core systems for the property are well-maintained and have been inspected in accordance with the council requirements within the previous one year. These systems include the features of the property that allow easy access or exit, fire escape, and other safety aspects.

Insurance

You shouldn’t assume that you know everything regarding commercial property insurance. So, consult a property insurance professional to help you understand all the requirements associated with the lease. The premiums you will be paying are higher than premiums associated with standard house insurance policies.

The commercial activity you intend to carry out on the property also plays a significant role in determining any other type of insurance cover you need.

Unit titles

If the property you intend to purchase is a unit title, the responsibilities of the property owner are slightly different. All the owners of each unit titles form a body corporate. The organization will hold regular meetings to make decisions regarding how the entire property is managed.

After evaluating the above factors and decide that the property you intend to buy is good, don’t forget to check all the tax implications associated with the property. It’s also wise to consult a financial expert to avoid overspending unnecessarily. Whether you intend to lease or buy the property, take the time to get it inspected thoroughly.

 

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