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Is It More Affordable to Build or Buy a Commercial Building?

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As a business or investor, you may be looking to purchase new commercial property. There is an alternative, however.

There are many factors when considering building your structure from the ground up. Which is the smarter and more affordable option? 

  • Survey The Property

Regardless of what you’re looking to buy, you’ll want to have it professionally surveyed. This allows you to see if there are any repairs, maintenance, or renovations that need to be made.

Having quality groundwork, for instance, is something only a surveyor can assess. They are able to provide options such as ground improvement stone columns to offer stability, improve load-bearing capacity, and reduce any further settlement.

  • Consider Downpayments and Renovations

Buildings that are already constructed will require some type of downpayment if you’re not intending to pay cash in full. This money will need to be saved ahead of time and provided by the investor upon requesting a loan.

There’s also a high probability that the location you decide upon won’t meet the exact specifications for your business’s needs. You’ll have to consider any renovations or building additions needed to suit your investment goals.

New builds allow you to create exactly what you want from the very beginning. The stipulation is that you’ll need to hire contractors and architecture firms, plus buy the land you intend to build on.

  • Look Into Tax Breaks

Investing in commercial real estate could offer some substantial tax breaks you may not be aware of. This applies more specifically if you’re bringing new jobs into the city. They think of it as an investment in your investment.

Properties that are considered historic buildings can be eligible for grants or low-interest loans to restore the building while preserving the integrity of the architecture.

Purchasing a building that already exists can also lead to tax deductions on the interest you’re paying. However, your building also depreciates the minute you purchase it.

While building new construction doesn’t lead to as many tax benefits, there are still certainly a few you could benefit from, such as the 179D Commercial Buildings Energy-Efficient Tax Deduction.

  • Think About How Soon You Need Your Property

One crucial element that a lot of investors don’t take into consideration is time. With new construction, it can take anywhere from two to six months, if not more, to complete the build. Plus, you’ll have to make sure it meets all laws and regulations according to the state and city guidelines.

A benefit of buying a property that’s already been built means you’ll only have to consider the timeframe for repairs, renovations, and decorating. You could be saving money simply because the longer your building is out of commission, the longer you won’t be making any income.

  • Potential To Recoup Costs Through Sub-Leasing

Buying or building a larger commercial property gives you the opportunity for sub-leasing. If you’re buying a building outright, it may not accommodate another business leasing out an office space.

If you decide to build out a new property, you can make it larger than you anticipate your needs being and sub-lease. It’s a larger investment from the beginning, but if you work out the numbers, you could easily recoup costs and make an even more significant stream of revenue.

Eventually, if your business needs to expand, you can utilize the extra space previously leased by other tenants for yourself.

Summary

There is no clear-cut answer as to which is the more affordable option, to buy or to build, when it comes to commercial real estate. There are several factors to take into consideration, with the most important being your budget.

Work with a professional accountant to look into your personal investments, outside investors, and any potential help you could get from applying for a loan. Understand clearly what your end goal is so they can help decipher whether new construction or buying pre-built is a better option for you.

The idea of Bigtime Daily landed this engineer cum journalist from a multi-national company to the digital avenue. Matthew brought life to this idea and rendered all that was necessary to create an interactive and attractive platform for the readers. Apart from managing the platform, he also contributes his expertise in business niche.

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Business

Robert DeFalco Realty Leads the Way with Strategic Expansion and Philanthropy

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Robert DeFalco, the visionary founder and Owner/Operator of Robert DeFalco Realty, cemented his reputation as a huge force in the real estate industry. His firm, recognized as the #1 real estate company in Staten Island, embarked on a significant expansion this year, solidifying its status as a comprehensive hub for real estate services in New York and New Jersey.

Strategic Growth and New Partnerships

This growth involves not only a physical expansion, but also a strategic partnership with Think Mortgage, a prominent mortgage firm with a strong presence in Brooklyn and Staten Island. The collaboration aligns perfectly with DeFalco’s vision of providing seamless and integrated real estate transactions.

“We are creating a holistic experience,” stated DeFalco.

By partnering with Think Mortgage, Robert DeFalco Realty ensures clients can find their ideal home and secure the best possible mortgage rates, simplifying the process into a smooth journey from start to finish — all in one building.

Comprehensive Services Under One Roof

The firm moved to a new location in Brooklyn, occupying an entire corner block to house its operations. The expansion ensures that clients can access all necessary services under one roof, including real estate and mortgage services, in-house title services, legal expertise, and more. The move underscores DeFalco’s commitment to providing unparalleled convenience for clients.

“We are creating a synergy where all real estate needs are met promptly and professionally, right here,” added DeFalco.

A Legacy of Philanthropy

Beyond his professional achievements, DeFalco is renowned for his philanthropic efforts. He believes in the responsibility of businesses to give back to their communities. Under his leadership, Robert DeFalco Realty is a leading sponsor for the Making Strides Against Breast Cancer walk, raising substantial funds annually.

In 2019, the Emergency Children’s Help Organization honored DeFalco for his significant contributions, recognizing him with the Man of the Year Award. His dedication to philanthropy also earned him the Service and Dedication Award from the Juvenile Diabetes Research Foundation in 2022.

Community Engagement and Support

Robert DeFalco Realty’s commitment to philanthropy extends to various community events and local charities. The firm supports a wide range of organizations, including the American Cancer Society, City Harvest, Monmouth University, St. Peters High School, and many more. Their efforts make a substantial positive impact, with total donations surpassing $1,000,000.

Most recently, DeFalco attended and sponsored the ECHO Foundation, GRACE Foundation, and Tunnel to Towers events in various capacities.

Looking Forward

With its recent expansion and continued commitment to comprehensive real estate services, Robert DeFalco Realty reaffirms its position as the premier one-stop real estate shop in the northeastern region. The firm continues to uphold its foundational philosophy of treating people well, a mantra that has guided its operations since its inception in 1987 and continues to inspire its growth and innovation today.

About Robert DeFalco

Robert DeFalco Realty was founded in 1987 by Robert DeFalco, a real estate Broker/Owner who wanted to help families achieve their dream of homeownership. Through the philosophy ‘Treat People Well,’ Robert DeFalco has grown into a successful real estate agency led by a professional team of highly motivated real estate associates with experience in residential, commercial, and new real estate development. For more information, please visit https://www.defalcorealty.com/ 

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