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WHAT YOU NEED TO CONSIDER BEFORE INVESTING IN OFFICE PROPERTY
WHAT YOU NEED TO CONSIDER BEFORE INVESTING IN OFFICE PROPERTY
By Dennis Isong
Office property investment is not just an investment you can barge into without putting some factors into consideration. Things have been changing rapidly which has created a different dynamic of how things work.
Few years back, it was easy to get away with mistakes made from investment. But, in this new age, mistakes made in investment would hit and eat you hard for a very long time.
Office properties are always assumed to be a very good investment for a newbie in property investment because it has the same features and benefits real estate brings. However, it doesn’t work out like that.
While investing in office properties, you need to be careful and be on the lookout. Good as it may seem, office properties project a great turnover but then, it cannot be valid unless some steps have been taken.
1.Consult an experienced property investment company with a track record of excellence.
As an investor, you don’t want to put your money in an investment that would yield little or nothing. No matter how vast you think your knowledge is concerning property investment, you’d do yourself a great favor by still seeking the advice of a property investment company before investing on office property.
Besides this, you need to do feasibility studies on the returns on such property and see if it’s worth putting your money on. Seeking advice from an investment company helps you have a better knowledge of the local market, the kind of business people are tuned to, if your office property fit in to the taste of the people and so on.
- Consider the local market.
There are different classes of property type and it would be in your best interest to put the local market into consideration. You can’t build an industrial-grade office property type with all amenities built for users who can afford to pay a premium price in suburbs or places where the tenants always seek lower price.
Many investors have made this mistake and I will cite an example. Mr. and Mrs. Popoola thought building an office with their retirement benefits is a great decision.
Well, it is but not a good one for people who lack the knowledge in office property investment. The first mistake they made was building in a community where office spaces were not that appreciated and needed.
And they tried to elevate it by putting in modern facilities, but didn’t work out. The couple felt the upgrade with a touch of class would attract people. Normally, it should but it didn’t in this case. By the time the building was ready to be let out, they encountered difficulty in getting people who might be interested.
Even, people who showed interest decided to put a ridiculous price tag on it. It took them over a year of maintaining their rent price and waiting for occupants who can afford it before it dawned on them that it may never happen and hoping for occupants who would place value on it is like chasing pavement.
Eventually, they succumbed to the price people are willing to pay just to keep the place occupied and have something(cash) coming in. An investment that yields little is a bad investment.
Normally, it takes a while to recoup what you have invested in a property despite the huge returns, how much more a property that has to be more or less, “dashed out” in order to be maintained.
3.Put co-working spaces into consideration.
Recently, co-working spaces are in high demand now for entrepreneurs and self-employed experts for rent. And with the present economy, it’s a great idea because it has proved to be prudent, economical and affordable.
People easily jump on this and it’s advisable to leverage on it as an office investor. One main advantage you should expect is high tenants’ turnover rates.
In a place like Lagos, there are offices which have modern facilities needed for co-working spaces. Some of these offices can accommodate 4 to 5 people at a go and this works well for entrepreneurs who need physical space.
One good thing is that they do not have to go with the traditional model of rental payment which is mostly annually. The mode of payment is monthly, so anyone can decide which of the months he/she will be available without the fear of tying down money (rent fee) unnecessarily.
Asides from this, you should lookout for competent occupants that pay rent come rain come sunshine.
- Be careful with the structure you buy.
When buying an office property, make sure that it’s a solid infrastructure. Avoid properties that would dig into your profits because you have to permanently repair them due to their poor condition. This may turn off future buyers and lenders. And also, stick with designs that won’t gulp your money or require endless maintenance such as using a lot of wood and stucco.
Finally, and most importantly, a good location works out well for office property and while looking out for location, do well in studying the type of lenders and price tag. Also, your building should be in great condition because this is one major factor that would determine the category of lenders.
Dennis Isong helps individuals invest right in Real estate. For questions on this article or enquiring about Real estate. Email: [email protected] or Whatsapp/Call +2348164741041
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Laffmattazz: Lagos 3rd Coming Features Star-Studded Lineup with Dbanj Gandoki, Akpororo, Taooma, Seriki Dariya, others
We Must Build A Virile Legislature For The Future, Speaker Obasa Says
Speaker Mudashiru Obasa of the Lagos State House of Assembly, on Sunday, counselled members of the House to strengthen the legislative arm of government ahead of the future.
Dr. Obasa gave the advice in Abeokuta, Ogun State at the opening of a three-day budget retreat for lawmakers and staff of the House with the theme: ‘Optimising the legislature’s power of the Purse’ for effective service delivery in Lagos State’.
The Speaker challenged the lawmakers to be committed in their legislative duties as they must leave lasting legacies for the future, strengthen governance, responsibility and accountability.
He charged the lawmakers on improved and effective legislative oversight functions being one of the responsibilities of the legislature.
“What we do now is really not about us; it is for the totality of the system.
“I appreciate this budget retreat. Each one of us must be responsible in carrying out the assignments we are tasked with. This is very essential.
“We carry out budget scrutiny based on what is presented by the executive. Once we give a go-ahead, it means the executive must comply and treat it accordingly because it has become a law.
“Going forward, all the reports of each committee must be presented at the floor of the House. This will help us decide on how to act for the sake of transparency and accountability,” the Speaker said.
He advised the lawmakers against docility in the task of ensuring that Lagos continues to weather economic storms.
“We all have roles to play and, in doing that, sentiments and self-benefits must be removed. The day you start with self-benefit, you have become a failure.
“If you do your job the way you should do it, you will earn your respect and will be held in high esteem by the Ministries, Departments and Agencies (MDAs).
“We are here today again to look at how we can improve on the laws we make at the House of Assembly as well as our oversight functions.
‘Let’s continue to be dedicated and loyal and I am sure we will get there. Let’s always straighten the path for Lagosians and those coming behind us,” he urged.
In his opening remark, the Clerk and Head of Service of the House, Barr. Olalekan Onafeko, described the retreat as an avenue to have insights into the state’s budget.
While commending the Speaker, he urged the participants to “be attentive and take home fresh ideas and knowledge.”
Eromosele Ebhomele
Chief Press Secretary to the Speaker of the Lagos State House of Assembly.
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