Retail space for lease versus purchasing retail space, that is the dilemma facing anyone starting a new business in 2023 and beyond. Conventional thinking, fifty years ago, favored the purchasing of commercial property, but that is not the case today, and in this article we will tell you why that is.
We are Fort Worth Design District, and we have commercial and industrial space for lease available in the funkiest, most creative business district in all of Fort Worth. Call us at 817-439-3224 for more information.
Let’s look at the reasons why leasing is rapidly supplanting purchasing among new business owners.
Retail space for lease is much less expensive starting out.
This is, without a doubt, the #1 reason why leasing is favored over purchasing in today’s business world. With the costs of commercial property rising rapidly, the down payment on a property purchase is simply not possible for most small business owners. Let’s say a 20% down payment on a property selling for $500,000, a business owner would be looking at a down payment of $100,000. We have been in the commercial real estate business for quite some time, and we know of very few, as in a handful, of business owners with that kind of cash for that kind of down payment.
Leasing retail space for rent just makes logical sense for any small business owner; it allows a business to have a fighting chance for survival by freeing available cash for things which count, like employee wages and product and marketing.
Retail space for lease saves you repairs and upkeep.
One of the unsung rewards of leasing property is that you, the business owner, are not responsible for the upkeep and repairs to your building. This is a huge consideration which can mean thousands of dollars, per year, in savings. The furnace stops working? Call the rental agent! The air conditioning not working? Call the rental agent! Plumbing problems? Call the rental agent!
It’s a beautiful world, this world of property leasing!
Seriously, for a small business owner, repairing or replacing a major item like a furnace could literally mean make or break in terms of profit and thus survival. If you purchases, and you already used your available cash on a down payment, how are you going to pay for that leak in the roof this coming Fall?
Flexibility in leasing.
If you purchased, and you outgrow that retail space, what are you going to do for more room? If you leased, you have options. You can ask the property manager to keep you in mind the next time an adjacent unit comes on the market. And if that is not possible, it is always easier to simply move at the end of a lease; it is not that easy to simply move out of property you own.
Do we think there are advantages to owning commercial property? Of course there are, but for the vast majority of business owners not named Elon Musk, leasing retail space is the logical way to proceed.
A final word about the Fort Worth Design District.
The Fort Worth Design District is actually three business parks in one district in North Fort Worth: Box Office Warehouse Suites, Paddock Place Office Suites, and the Golden Triangle Business Park. No matter what kind of property you need, we have it. Call us today and arrange for a tour of this truly unique business area.