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construction / hospitality / world

Pros and Cons: Buying vs. Leasing Commercial Space

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We’ll be direct. When you have a startup or a small business,leasing offers more flexibility in money,loaning,and changing locations. If you plan to buy a commercial space,only do so if you’re prepared to rent the same space.

Comparison of Benefits and Drawbacks of Buying vs. Leasing a Commercial Space

When you buy or lease a commercial space,you must decide which benefits you want and which drawbacks you can live with. Therefore,we don’t just compare the pros and cons. Instead,we compare the benefits of buying against the benefits of leasing. We also compare the drawbacks of buying against the drawbacks of leasing.

As you can see above in the table,the benefits of buying a commercial space is higher. But the higher the benefits,the greater the risks. Below,we also compare the drawbacks of leasing and buying a commercial space. 

Benefits of Leasing Commercial Space

Renting is more viable for small businesses and startups. Leases allow you to move and spend more money on other costs. Below are some of the benefits of leasing a commercial space. 

  • Lower Upfront Costs

When you only have to pay rent,you don’t need a down payment. This also frees you money for qualifying for other loans. But you’ll need to pay the attorney,broker,release inspection,and security deposit fees.

  • Predictable Monthly Costs

You wouldn’t need to spend for unexpected damages on the property when leasing. This advantage makes it easier to budget and plan for the future. Check your contract for the extent of your responsibility in fixing what would be defined as minor repairs.

Benefits of Buying Commercial Space

When buying commercial real estate,you also get the advantage of having a property. You are more likely to qualify for loans because your commercial property makes you more stable and secure. You also have more assets aside from your business. 

  • Long-term Investment

As equity increases over time,so does capital appreciation. Capital appreciation is affected by the same things as equity: inflation and local and industrial economies. With your long-term investment,you can fund your retirement once you sell your property or business.

  • Rent Income

When owning a commercial space,it is best to take advantage of renting it. Most businesses only use 50% of their commercial space. You can earn extra income from your business by renting the rest of the space.

Countermeasure Drawbacks of Leasing Commercial Space

Just as there are benefits to renting a commercial space,there are also downsides. While rental costs are fixed,they can be bigger than fixed mortgage rates. 

  • No Equity

Unlike owning a property,rental properties don’t build equity. Fortunately,there are lease-to-own commercial properties where your rent is part of your purchase.

  • Rent Increases

Landlords may increase rent at the end of a lease term,which can affect a business’s bottom line. While you can move,you must consider the moving cost versus the monthly lease.

Countermeasure Drawbacks of Buying Commercial Space

Buying commercial property has its downsides,too. Just as you can have bigger gains by purchasing a property,you also have bigger risks and payments. 

  • High Upfront Costs

Purchasing commercial space requires significant upfront capital. Down payment for commercial spaces in Washington can be 20-25% of the purchase. Getting small business loans can help get the funding you need. 

  • Maintenance and Liability Costs

Property owners are responsible for maintenance and repairs,which can be costly and time-consuming. Remember to buy liability insurance for costly legal fees and settlements.

Buy or Lease Commercial Space: Factors to Consider

It will take time and thoughtful consideration whether to buy or lease a commercial property. Below are factors to consider,which we hope to give you insights into your important decision. 

 

To Buy or Lease Commercial Space: Your Final Decision 

Buying or leasing commercial property offers pros and cons. We often recommend renting for small businesses and startups. We also recommend buying a commercial space if you are prepared to rent the same space. 

However,  it is best to look at your business situation. By knowing your business needs and goals,you’ll understand better which benefits are for you. By knowing what you don’t need and what you can risk,you can decide which drawbacks you can live with.  

Once you’ve decided,check out Commercial Space to learn more.  
 

construction / entertainment / people

San Francisco CA – The Next Big Thing

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San Francisco CA is always changing. It’s a place that always pioneers the Next Big Thing and attracts people who want to be part of it.

This is a beautiful,diverse city with many different cultures. It’s important to accept that there are many homeless people in the city. They are not a problem.

The Golden Gate Bridge

It is an impressive sight with towers rising 746 feet in the air. The signature color of orange vermilion is a sign of American ingenuity. It’s a true engineering marvel that took years of planning and construction.

The bridge was opened to vehicular traffic on May 28,1937,ahead of schedule and under budget. The main span was the world’s longest suspension bridge until it was surpassed by the Verrazano-Narrows Bridge in 1964.

Visitors can walk or bike the entire length of the bridge and take in its stunning splendor from many vantage points. This is best done at sunset to see the subtle lighting of the bridge reflected in the water. For an even more special experience,the bridge is also lit up at night.

Golden Gate Park

Often compared to New York City’s Central Park,the 1,017-acre Golden Gate Park offers both residents and visitors tons of beautiful escapes. You can find everything here,from top-notch museums and botanical gardens to lakes for boating.

The Japanese Tea Garden and de Young Museum are some of the most popular attractions. Sign up for a 2-hour guided bike tour to explore the park in greater depth. You will see the top attractions and lesser-known gems like the Redwood Tree Grove or Storybook Cross. You can also walk,run or jog around the park. On weekends and on nice days,the park can be quite crowded.

The Exploratorium

The Exploratorium isn’t really a museum; it’s a thought-provoking experience that blends science,art and human perception. It’s been around since 1969 but recently had a huge makeover with a new location on the Embarcadero. You can now touch,tinker and explore over 600 exhibits.

One of the most popular displays is the Tactile Dome. You can only navigate through the pitch-black dome by bumping and feeling your way.

Other interactive exhibits include the Sound Bite and the Fog Bridge (by Fujiko Nakaya) that connects Pier 15 and 17 releasing a fog-like cloud for six minutes every half hour. For dining options,there’s the low key Seaglass Restaurant serving family friendly meals and drinks sourced from small Bay Area producers.

The California Academy of Sciences

California Academy of Sciences,located in Golden Gate Park,is a world class aquarium and planetarium as well as a natural history museum. The California Academy of Sciences allows visitors to explore the depths of the ocean,travel across time and continents,or launch into outer space while supporting world class scientific research.

Visitors can see African penguins being fed,gaze in awe at realistic dinosaur dioramas or try to keep their balance in the earthquake simulator. The Academy also has educational and community outreach programs to help the public understand the importance of preserving our planet.

To get the most out of your visit,buy tickets online in advance for a specific date and time. You can save $3-5 per adult by doing this,and kids are always free. Look for other discount cards,such as the Go San Francisco Card or CityPASS.

The Castro

The Castro is San Francisco’s LGBTQ neighborhood and the most famous in the world. Many members of the LGBT Community have historically moved to this area,particularly dishonorably dismissed soldiers after WWII. They did so because of its liberal politics,and tolerant culture.

There are many bars,cafes,and shops that cater to this neighborhood,such as Mix,which offers cocktails,dancing,and karaoke. Hi Tops is the neighborhood’s first gay sports bar and its deafening cheer with every Giants victory is a highlight of any visit here.

A popular annual event is the Castro Street Fair,founded in 1974 by Harvey Milk. His success story (and tragic death) helped put the district on the map as a gay destination. The fair features local businesses,drag queens and performances.

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