How to attract great tenants for your commercial investment property

When we think of an investment property, we usually think of residential. Many people don’t even consider looking at, let alone owning, a commercial property.

Commercial property does come with some great positives; there is potential for higher returns and there are often fewer outgoings. However, while commercial is often cheaper than residential property, you may need a bigger deposit.

Also, while residential property often has longer leases, there is a tendency for it to sit empty for longer, which is why it is imperative you make it as attractive as possible for potential tenants.

Like a residential property, making it look good, is a start, but there are some other aspects you need to consider:

What will the property be used for?

You need to think about what the space can be used for. Can tenants build their brand and put their own stamp on it? Will the space be office or retail? You need to know what type of tenant you want to attract, as this helps you decide what renovations you should make.

Toilets

Yes, a bit of an odd one this one, but toilets can be an issue. For instance, if it’s a relatively large space, and you’re wanting to attract an office tenant, you may want to consider having male and female toilets. For retail, depending on the size, you may get away with having one, unisex toilet.

Keeping your tenants and their customers safe

A working fire escape is a must. You may also want to consider improving lighting in any corridors or stairwells. Are there any lose slabs outside? If so, who’s responsible for fixing them, you or the local council? If it’s the council, get onto it to make them safe, ideally before you start showing prospective tenants around; prospective tenants don’t want customers literally tripping into their business.

Beefing up the security

Whether it’s residential or commercial, everyone wants to be safe. Upgrading the alarm and/or installing CCTV often make a property more attractive to tenants.

Added extras

Extras can be a deciding factor for similar properties. Depending on what tenants you are attracting, you may want to consider throwing in access to the internet or some furnishings with the lease.

Going green

Adding ‘green’ features could potentially make your commercial property more attractive for tenants, particularly if its features which will save them money! Consider improving the roof insulation or adding water saving devices.

Commercial property does offer some fantastic investment opportunities, and we know investors who diversify their portfolio by investing in both residential and commercial.

However, just like investing in residential property, do your homework. Find out about the area and get to know the commercial market. While there are some great bargains to be had, you need to really know what’s planned for the area and what type of tenants your property is likely to attract.

Talk to your financial advisor and other professionals so you can fully understand the risks involved.

As one of Newcastle’s longest established real estate offices, we’ve helped hundreds of people realise their financial dreams through both commercial and residential property. If you’re interested in finding out more, get in touch by giving us a call on 02 4956 9777.

Or send us an email to mail@newcastlepropertymanagement.com.au or pop into our Cardiff office for a chat.

For more property management tips check out our Facebook page: www.facebook.com/NewcastlePropertyManagement