Investing in commercial real estate is highly rewarding. But before you go for commercial real estate investment in India, remember these points.
When investing in commercial real estate, pay attention to overall investment portfolio.
When deciding on how to investing in commercial real estate property in India, location plays a paramount role. There are preferred as well as not-so-preferred micro-markets when it comes to commercial real estate investment in India.
The choice of location depends on various factors such as proximity to key hubs, accessibility, proposed infrastructure developments etc. Emerging micro-markets can be evaluated if existing ones show saturation. This enables commercial real estate investment in India with an eye on long-term capital appreciation.
Robust cash flows due to a good location and building will be but obvious. This means the space needs to be ready for newer tenants and opportunities.
This also means the building needs to show superior technical specifications and in accordance with design and structure as well as green building certifications. Multi-tenanted area areas etc need to be professionally well-maintained. The owner should be able to handle exigencies and must have a corpus fund in this regard.
Additionally, the utilities should be energy efficient and environment- friendly. Management and maintenance need to be paid attention to before signing on the dotted lines when it comes to commercial real estate investment in India.
Like every other field, a question like how to buy commercial property in India can only be answered by analysing current trends. From specific market performance over a period of years, forecast, rent, to tenant profile and other data, clarity on the financials matter.
It is also important to pay attention to lease contract, especially details such as expiry of the lease, escalations or lock-in period, etc. A well trusted real estate agent should be consulted at all times for an informed decision when considering how to buy commercial property in India.
Related documents such as utility bills, planning permit, approvals, taxes should be thoroughly checked as part of due diligence. A tenanted property needs a thorough understanding of the contract, especially lessor’s covenants or obligations.
This would smooth-en out the process with no surprises at a later date. It is also a good practice to check the presence of mortgages secured against the property.
Look through the amenities carefully so that they don’t override the cost. Car parking stalls are no longer an amenity. An essential retail space or a food court in a large campus would certainly enhance marketability of the space when looking for commercial real estate investment in India.
Taking into consideration such pointers, a thorough market study should be done with the help of a professional real estate consultant.