Things to Know Before you rent or lease a commercial space

by Daniel Morris Content Writer

Commercial space refers to real estate property that is used for business activities and ideal for businesses that need room for cubicles in addition to a reception area, offices, and conference rooms. Usually It can be refers to buildings that house businesses, but it can also refer to land that is intended to generate a profit, as well as larger residential rental properties. They are normally centrally located, making it easier for employees who commute.

Before you rent or lease a commercial space, need to consider the following:

• Clients and Customers: Does your business regularly have customers or clients coming in? If yes, then a commercial space would be perfect for you.

• Your Business: does your space matter for your kind of business? Does your business increase of people coming in throughout the day and making a purchase, scheduling a service, or is your business more of an office setting with clients calling or emailing throughout the day with their needs?

BREAKING DOWN Commercial Space

Commercial Space is one of the three main types of commercial real estate, along with residential and industrial. As its name implies, commercial space is used for commerce, office and operate business (residential space is used for living purposes, while industrial space is used for the manufacture and production of goods). While some businesses own the buildings they occupy, the more typical scenario is that an investor owns the building and collects rent from each business that operates there. While residential space lease rates may be quoted in an annual sum or a monthly rent, commercial space is customarily quoted in annual rental per square foot.

Commercial Space Classifications

Commercial Space is categorized into different classes. Office space, for epitome, is divided into one of three categories: class A, class B or class C.

Class A represents the best buildings in terms of age, aesthetics, quality of infrastructure and location.

Class B buildings are usually older than and not as competitive price-wise as Class A buildings. These buildings are frequently targeted by investors for restoration and maintenance.

Class C buildings are the oldest, usually over 20 years of age, need of maintenance and located in less attractive areas.

Why Commercial Space?

One of the biggest advantages of commercial Space is the attractive leasing rates. In zones where the amount of new construction is either limited by law or land, commercial space can have remarkable returns and considerable monthly cash flow. Industrial buildings generally rent at a lower rate, though they also have lower overhead costs compared to an office tower.

Commercial Space also benefits from comparably longer lease contracts with tenants than residential Space. This gives the commercial space holder a considerable amount of cash flow stability, as long as the building is occupied by long-term tenants.

Now that you’re well-found with this knowledge, the decision should be easier to make.

If you are looking for Commercial Space in Baton Rouge, Consult your local Commercial Real Estate Advisor.