Property is undoubtedly a financial asset that every business should consider investing in. With modern building solutions, such as modular building making buying a business property a distinct and affordable possibility, it may be that more businesses will be able to invest in a business premises.
There are many pros and cons to leasing a business property, just as there are when renting a domestic property.
There are pros and cons to buying a business property too, but when you spend time researching what the local property market has to offer and get the figures to stack up, owning your own business property becomes a reality.
Is it financially the right thing to do at the right time?
The figures are important. If there is a shortfall, or the financial stretch of meeting mortgage payments and maintenance costs is too much, owning or evening renting your business premises can be a financial step too far.
There are various factors to consider;
Maintenance – as with any property, it needs to be maintained to a high standard to retain its value.
‘Fixed’ mortgage payments – rent reviews can result in rises that are difficult to meet but mortgage payments can either stay the same or decrease, depending on the mortgage product you have.
Increased value – improving your business property means increasing its value, something that you should always aim to do and becomes an asset to your business as a result.
Sub-letting – if you have premises that are too big, you could reap the financial rewards by sub-letting a portion of it. But, being a landlord brings additional responsibilities which you must meet.
Long-term – buying a business premises is a long-term commitment.
Is the timing right?
Buying at the right time depends on many things – the economy, the financial position of your company, for example – and then there is the fact that to buy property in the UK can take so long.
This means waiting for weeks to get the keys and start the business re-location. And, if you choose to build your own premises, it can mean months of watching the slow progress of your new premises.
Which is why more and more businesses are turning to modular building solutions. As the foundations are dug, the build begins in a ‘factory environment’; when things happen in tandem, time is sliced off the build.
And with pre-fabricated structures also taking less time to complete to a high standard, you can have the turn key solution within weeks, rather than months.
Is the property in the right location?
Location is paramount, the basis of which will vary from one business to another. Is it about customers or patients being able to access modular healthcare buildings, for example, or is it about the ease of delivery? Getting the right staff can also depend on being in the right location.
There are few business premises for sale when compared to the rental stock available that sometimes, the right location is an issue. However, if there is the possibility of buying a parcel of land in the right place and opting for a modular build solution, you may tick all the ‘location boxes’.
Is it the right property?
What do you need for your business? Do you want open plan office space, or high-end, forensically clean laboratories? Do you want separate rooms or clinic spaces, or larger spaces?
How adaptable is the building you have bought? In older properties, there can be structural issues such as supporting walls preventing vast open spaces (the cost of structural inclusions such as pillars etc. prohibitive in terms of budget and time). There is also the inflexibility of a building as well as unwanted ‘surprises’ when you start to knock a building about that eat into your budget.
With modular buildings, you can change them as much or as little as you want. Simple, innovative design with versatility and flexibility thrown in.
Does it create the right impression?
And finally, impressions are everything.
What does a modern, bright building in a great location say over and above a property that is in dire need of attention and maintenance?
It can be tough to stay on top of maintaining an older building. There can be changes that need making that are hidden – like re-wiring – but are essential from a health and safety point of view.
In fact, it is the ongoing maintenance of a business premises will be the biggest drain on resources and budget.
But what if the building your bought or rented, the most valuable asset of your business, was a modular build?
Written by Kamala Pradhan, marketing co-ordinator for MTX Contracts.