Commercial land investments can increase the value of your portfolio. On the other hand, committing simple investment mistakes can cost you money down the line. So how can you make wise decisions when purchasing commercial land?
What Constitutes a Commercial Land?
Any area of land used for business and intended to make a profit is considered commercial land. Chapter 479 Section 01 of the 2011 Florida Statutes further defines commercial land as a piece of land designated for commercial use under both the future land use map of a comprehensive plan and the land use development regulations adopted in accordance with chapter 163.
Residential and commercial real estate is valued and handled differently by municipalities and infrastructure providers. Residential real estate values typically increase yearly, but the value of the commercial property can change drastically depending on its location and the surrounding properties that are already (or will be) built.
Commercial zoning refers to the designation of a piece of land for use by establishments that deal with the general public, such as offices, retail stores, shopping malls, hotels, restaurants, banks, and bars. These enterprises often don’t make a lot of noise or mess, and many of them get along quite fine with houses. Local governments will evaluate issues including accessibility, transportation options, parking, and influence on neighborhood people when zoning land for commercial use. Aside from warehouses, commercial real estate, retail shops, parking lots, shopping centers, hotels, office buildings, and medical facilities, commercial land can also be home to apartment buildings and other profit-making residential structures.
Tips Before Buying Commercial Land
Here are some suggestions that can help you in your search for a commercial land on sale.
1. Buy land in the path of development
The fact that land is a limited resource, especially in urban or developed areas, is the best reason to invest in commercial land. One tip is to look for land in up-and-coming areas. You might also want to search for land near a municipality’s planned growth. Purchasing land that will be used for development provides you the chance to sell it for profit in a few years.
2. Get pre-approved for a loan
Financing can be challenging if you are new to investing in commercial real estate. Before looking for available parcels, start asking about financing if you intend to take out a loan to buy commercial land. Find out which banks and lenders offer commercial real estate loans for undeveloped land by conducting local, national, and online research. Additionally, first-time investors should be aware that the process for commercial loans is very different from that for loans for residential properties. The requirements are more demanding, and you might need to put down as much as 20%.
3. Understand commercial zoning and usage laws
Nothing could be worse than spending money on a commercial property only to discover that it is not zoned for that purpose later. Property zoning should therefore be one of your top priorities. Make sure you are familiar with a piece of property’s zoning and usage regulations before investing.
4. Do your due diligence
Potential investors in commercial land must conduct due diligence, as with any investment. It is advisable to visit the property and view it in person, unless you are an expert in land. By visiting the site, you will be able to observe the topography in a way that is impossible to see on a map. Ask about the accessibility of utilities as well. Last but not least, be ready for environmental examinations for items like dangerous substances, or subterranean tanks and pipes. If none of these concerns are resolved, they could all result in serious problems or financial failures.
Consult with a Commercial Real Estate Professional
Transactions involving commercial real estate are inherently difficult. Additionally, even though purchasing commercial land for sale may be a little simpler than purchasing an office or retail space, you still need a professional on your side. You can seek help from the land experts at The Vision Group in navigating the process and locating suitable commercial land for your portfolio.
We can make your life much simpler and clearer for you. Call us at 941-357-4040 or visit our website at https://thevisiongroupllc.com/ if you want us to help you find the right property.