Deciding Which is Which
by:
Edwin Malipayon
Ubiquitous in the minds of people who own commercial lots and explore for income is how to maximize their property to be able to reap the most profit.
In the midst of their excitement to put up their own building(s), confusion gets in, and owners sometimes make wrong decisions because they let others think for them.
Yes it's right to consult experts in Real Estate Management; however, it should be you who does the thinking most. You should be the one doing it . . . deciding what is in and what is out . . . . choosing what is best for your property.
Thus, it's imperative that you make your own decisions after you have weighed their suggestions or proposals and not others. It's not good to be too trusting when your investment is at stake.
How to choose the best suggestion or proposal that really maximizes your commercial property?
After collecting the proposals of consultancy or construction firms, you should conduct your own CBA (Cost Benefit Analysis) on each proposal and collate these to be able to determine the best one.
The one which benefits highly exceed the costs is the one appropriate for your property.
However, you should be careful on your assumptions or the assumptions given to you by the consultants. Yours or their assumptions may not be the case as these might be over speculative due to nonconformity of the proposed improvement to what really is prevailing or the HBU (Highest and Best Use) of the property.
These are the practical approaches in deciding what building to put up on your commercial property that will maximize its profit:
If all of the proposals suggest improving it with a high rise building, see to it that the proposed building strictly conforms with what is prevailing and if it's the case make sure that other existing buildings in the immediate vicinity had incurred minimal vacancies so as to be able to know that the proposed building is viable and will not be a fiasco, wherein your ROI is not what you have positively expected to be.
However if your property is situated in a growth-center wherein every now and then influx of business establishments is palpable, then it's just right for you to put up a building not conforming or higher to what is prevailing, for in the offing more and more commercial/office spacers will transfer in the area as their location strategy and be able to avail the prominence of the economies of scale in the said area.
If your property is located in a light commercial area where still preponderant are small businesses, then low rise buildings are the ones appropriate to be erected on it.
In this case, maximizing your property is maximizing its area and one way to do it is manipulating its shape.
If the commercial property you own is rectangular and the longer dimension is the depth, the right thing to do is to put up two buildings fronting each other and at the middle is a narrow road which traverses the property and is perpendicular to the abutting road serving as access.
If it's the other way around, meaning your frontage is longer, put up a 2-storey building. In a light commercial area, visibility of commercial spaces is the only thing that matters. Thus in putting up a 2-storey building, the higher and ground levels are both conspicuous at the abutting road.
Copyright © 2006 Edwin R. Malipayon, All Rights reserved
About the Author:
Edwin R. Malipayon is a Registered Electrical Engineer. He is also a Licensed Real Estate Appraiser and currently connected with UCPB as Senior Appraiser. An MBA graduating student at USEP. Pursuing writing his experiences and studies in Business and Real Estate Management. Presently processing his membership with American Society of Appraisers. You can email him at
happy_rem15@yahoo.com for your comments on his articles.
No. of Times this article has been viewed :
2170
Most Recently Published Construction Management Articles as of
|
|
Construction Loan Rates: The Costs Of Financing Construction
by
Donna Hammond
Ffinancing the construction of a property by means of a construction loan is not for free. Find out more about the costs of financing construction.
|
Construction Loans: All You Need To Know
by
Donna Hammond
Construction loans are increasing month after month. Following is some basic information about construction loans that everybody should know.
|
How to Create Cost Savings in Construction
by
Mejia Jones
How we factor in the costs taking into account the entire life cycle of the facility to be built is critical. We must remember that construction cost forms only one part of the life cycle cost, and it will be the owner of the facility who will have to bear the costs after the construction phase.
|
Safety Changes in the Construction Industry
by
Mark Burdett
This article looks at recent changes in regulations which affect the construction industry and what steps you have to take as a client to make sure that everything is legal.
|
Some Great Options - When Purchasing New Construction
by
Lance Mohr
When you purchase new construction there are many choices that you should consider. Homes in a gated community and water views are just some for consideration.
|
How to Select the Best Construction Estimating Software Solution for Your Construction Business
by
Mark Kennedy
How to select the best Construction Estimating Software Solution for your construction business - Best Practices
|
Choosing the Right Home Builder
by
BMA Editorial Team B .
Not all home builders specialize in high quality homes, or offer buyers the chance to personalize their home. That is why choosing the correct home builder is such an integral part of a positive home buying experience.
|
7 Hard-Knock Truths To Building A Successful Construction Business
by
Damion Rutherford
7 Indisputable facts (in my opinion at least) that I've learned (mostly the hard way), that must be followed. That you must accept in order to be successful in the construction industry. Or, any business, for that matter.
|
Advantages of Building Your Own Home
by
BMA Editorial Team 3
Buying a home is the biggest financial investment you will ever make in your life. To ensure you get exactly what you want; nothing more, nothing less, building your own home is a great alternative to settling.
|
Protect Yourself When Working With a Home Builder
by
BMA Editorial Team 3
Here we will discuss some things you will want to keep in mind when working with a builder of your new home. The more educated you are, the less likely mistakes will be made and regrets to be had later.
|
Ten Ways of Generating Leads in Construction Marketing
by
BMA Editorial Team 3
The bottom line in all our marketing efforts is a constant flow of high quality leads. Without this, the business begins to grind to a halt. However, there is a danger of capturing irrelevant information that can be distracting and time consuming and in the end quite counter productive.
|
Metal Buildings Promote the Green Lifestyle
by
BMA Editorial Team 3
Many people steer away from erecting these structures because they believe that their budget will not allow for it. What many tend to not realize is that though purchasing the materials for this project may be more than normal structures, the longevity of the project speaks for itself.
|
Twelve Things Every Construction Marketing Consultant Should Know
by
BMA Editorial Team 3
There are twelve essential research criteria that need to be met if we are to be successful in construction marketing. Knowing the business and knowing the prospect's business is key to success.
|
Four Reasons Why Construction Marketing Fails
by
BMA Editorial Team 3
The construction industry is a highly competitive market place. When 100 builders are chasing one tender, the stakes are high! Your company needs to stand out from the rest and have a unique selling point that will attract potential clients.
|
What Green Building Means
by
BMA Editorial Team 3
There's a lot of talk in real estate about green building lately, but the phrase is still a little vague. Here's a guide to understanding a few key terms, so you can investigate whether or not a potential home is truly eco-friendly.
|
Construction management, estimating, scheduling reporting, construction loan estimating and finance management, delays estimating, activity planning, resource allocation and linear programming in construction.
|
|
|
Search for ebooks on Management & Business