The dream of many small business owners is to one day own the building where they do business. Whether a stand-alone building or large office building, the idea of building equity into a piece of property, and possibly allowing others to pay your mortgage through leases, is appealing. But before you run headfirst into a commercial property deal, should one come available, here are some costs to consider.
Insurance – Insuring a commercial building properly can be expensive. Be sure you factor this in when determining your costs.
Debt – Probably your largest expense, your monthly obligation will be many multiples of what you pay for your lease. Be sure you can cover it if your tenants all leave.
Utilities – Usually, water and sewage are picked up by the owner of the property, and electricity is covered by the tenant. You will also be responsible for the utility costs …