Gurgaon has recently become quite a hotbed for real estate development. The popularity of the city’s real estate market can be attributed to a number of reasons, including its world-class infrastructure, the presence of several MNCs, and seamless connectivity to nearby cities. The galloping growth that Gurgaon has shown in terms of real estate development, spanning about two decades, has helped thecity earn the title of the ‘Millennium City’. That being said, there is hardly any doubt today that if you wish to invest in commercial office space, Gurgaonis one of the best cities that you can choose.
However, you must remember that a successful investment in real estate requires due diligence, strong research, and an essentials’ checklist. All these together can help you ensure that no important aspect of the investment is neglected. With numerous options in Gurgaon for commercial property for rent, lease, and sale, being confused about which property to choose is quite normal. To help you along with your investment decision, here is a handy guide for investing in commercial real estate.
From identifying the target property to working through the process of purchasing it, this guide will help you find the most lucrative commercial real estate deals.
Your Guide and Checklist for Buying Commercial Real Estate
Whether it is a commercial office space in Gurgaon or in any other city, there are certain points that you would need to keep in mind:
1. Identify Potential Properties
Good returns on investment through commercial properties are based on two avenues – capital and rent appreciation. Both of these elements are highly dependent on the location of your property. Hence, careful consideration is required when investing in the commercial real estate market. Here are a few points for you to check before investing in commercial office space in Gurgaon, or in any other city for that matter:
- Appealing location
- Infrastructure
- Demand &supply
- Market rent & in-place rent
- Creditworthy tenants and staggered leases
- Lease structure
- Diversification
After taking into account all the above elements, you can begin to organise your results,shortlisting the most suitable properties.
2. Ownership Analysis
Ownership analysis is very important when planning to rent or invest in real estate. This gives you detailed background information about the property you are interested in. There are platforms where you can look for potential properties and get detailed information about them and their owners/developers.
There are numerous options for potential investors who are looking for commercial property for rent or for purchase in Gurgaon. Knowing details about the number of owners, debt history etc. will help you in analysing the transaction history of the property. Do remember to check the debt history particularly in order to better understand the financial standing of the property.
3. Property Inspection
While online research plays a key role in you finding potential properties that are suitable for your needs,you should not solely depend on online research itself. Make sure that you personally visit the property for an inspection and if required, you can also look for a certified professional who can help you with the same. Doing so will help you ensure that your potential new investment is as described and comes with little to no headaches for the future.
Here is a list of a few general things you should ask or find out before purchasing a commercial property or office space:
- Does the project/property have a sound structure?
- Does it have adequate parking space to fulfil your requirements?
- What amenities does it offer?
- Does it have a sound HVAC system?
- Has it been developed sustainably?
4. Evaluate the Property
Once you have found a property that appeals to you, you would want to know more about its true market value. This will help you find out your preferred rent or purchase price. Besides, you can use these details to compare other potential properties of similar value and pick the best from among them. With all these details, you will be able to get a fair idea of the market price for the property even before you reach out to its developer/owner.
5. Study Property Deeds & Titles
Deeds and titles related to property have the potential to decrease its market value, muddy the ownership history, or may even lead to limitations being put on the property’s usage. Thatis why it is very important to analyse such aspects before you finaliseareal estate deal.
A property title search would be apt for you to find out the details of whether the property is tied to any liens, mortgages, tax debts, or misattributed seller ownership. Online research may not be sufficient for you to dive deep into the nitty-gritty and you may have to visit the local authorities to acquire the necessary information.
6. Have the Property Appraised
A commercial property appraisal is a process of evaluation undertaken to understand the true value of a property as well as the future returns it may offer. These appraisals form the basis oftheir sale. Ideally, this process is conducted by professional property valuers. They help assess the potential returns on investment (ROI) that a property can offer you.
A professional appraiser will have the expertise to evaluate different types of properties, further helping you understand your investment more holistically. Below are three common methods that are used in commercial property evaluation:
- The cost approach
- The sale comparison approach
- Income capitalisation approach
7. Check Zoning Regulation Compliance
Zoning regulations specify whether a particular location can be used for commercial or open space purposes or not. When looking for commercial office space in Gurgaon, make sure that the property you choose complies with the current zoning regulations. This is another necessary due diligence that must be performed when you plan to invest in commercial properties.
It is also important to factor in your own plans for property usage, future renovations, and chances of expansion when checking zoning compliance. Additionally, stay informed on the implications of zoning compliance and the related fees.
This essential checklist for buying commercial office space in Gurgaon can act as a quick and handy reference point for ensuring that you make an informed decision. It will help you unlock commercial real estate insights and opportunities with ease.
