Owning commercial property is a great way to make consistent income. However,
there are too many commercial landlords not making the most of their space and,
therefore, not making the most money from their commercial spaces. With a few small
investments in a commercial property, building owners can increase their positive
cash flow and ensure long-term tenant relationships. Here are a few ideas on how to
make the most of a commercial space:
Maximize Physical Space
Oftentimes, commercially rented buildings are not utilizing the maximum amount of
physical space. Unfinished areas or square-footage that hasn’t been built out is
essentially dead air. Build these spaces out, but make sure they’re comfortably sized.
The goal is not to sacrifice necessary square feet in other units in order to squeeze in a
rentable space. Tenants will feel cramped and are less likely to renew their lease.
Property owners will want to create areas that are inviting, not tight and
uncomfortable. If it is possible to finish any unused spaces and divide the units in a
reasonable way, investors can create additional opportunities for income. If dividing
the interior space comfortably is not an option, there are ways to maximize the use of
exterior spaces. Additional storage, company event spaces, extra parking, or building
employee areas are all ways to increase the value of a rented property without costing
owners much.
Make sure your building is using every square foot in a positive way. Build out areas
that are unfinished and create useable areas on the exterior of your building if
possible. You will be giving tenants a little something extra, which brings us to our
next point.
Offer More
By creating an inviting and comfortable environment for tenants, property owners
give themselves an edge against competitors. Small efforts, like adding coffee and
vending machines to public or shared spaces not only provides positive cash flow, but
can also give a commercial building that extra boost of convenience. The goal is to get
tenants to stay long-term.
Other ways investment property owners can offer extra services is by offering
cleaning services, maintenance and repair, advertising opportunities (such as
billboards outside the building), and trash removal for tenants. Be sure to negotiate
these terms when it’s time to sign the lease, allowing tenants to choose which services
they are willing to pay extra for to make their own lives easier.
Offering additional services, meaning more than just a unit to rent, gives property
owners a stronger relationship with their tenants. Good relationships are key in
getting tenants to sign long-term leases and helping owners avoid the cost and
frustrations of high turnover rates and vacancies.
Maintain the Property
Of course attracting and keeping tenants is every commercial property owner’s goal.
Maintaining the property goes a long way toward meeting that goal. Poorly designed
or unattractive buildings can make it difficult to get and keep tenants. Updating
windows and doors is a simple, yet effective, way to increase the value of a commercial
property while also keeping your building looking and feeling fresh. Even a new coat
of paint on the exterior of the building can make a property more attractive and
valuable.
Consistency is key when it comes to property maintenance, as the cost of major
repairs and damages often outweigh the cost of steady upkeep. Unlike residential
properties, commercial properties incur more damage day-to-day. Regular
maintenance is a practical step toward making sure property owners are not left with
staggering costs of emergency repairs and replacements. Commercial property
owners should not only ensure routine maintenance checks, but also have a repair
company on hand in case an issue arises. Catching plumbing and electrical issues early
keeps tenants happy and the building safe.
Safety is important to tenants, and investing in security is another good way to add
value to your property and entice tenants. Updating or increasing security by adding
gates, window shutters, or alarm systems can all increase value.
Why it Matters
At the end of the day, commercial property owners want to create a space where
tenants want to stay. It might seem like a lot of extra work to implement, but investing
in the property ensures an increase in steady and positive cash flow. Turnovers and
vacancies cost owners money, it’s that simple. Not only because of the lack of
incoming rent, but there’s the expense of advertising the space while trying to find
new tenants.
Making the most of commercial space can be accomplished in several ways. Whether
it’s maximizing square footage that isn’t being utilized to its full extent or simply
providing an attractive and updated work space. Small investments create positive
cash flow for commercial property owners, while giving the property an edge in a
competitive commercial market.
Do you have a commercial building project in Terre Haute or the Wabash Valley? Contact Hannig Construction, Inc. today and a representative will reach out to you shortly!