Owner-occupied real estate is key to building personal wealth
It is now 2011 and the business community is still trying to push its way through the “Great Recession.” The question on everyone’s mind is, “When are we going to come out of this?” However, we all know that our local economy is not that black and white – things are never all good or all bad.
What is certain is that there are opportunities of a lifetime right now if you know where to look. For many small business owners, owning the real estate from which they operate their businesses is a critical part of building personal wealth.
It is my belief that 2011 will be a huge year of investment in our local real estate market. The first thing to consider is interest rates. According to Brian Beaulieu of the highly successful – and astonishingly accurate – Institute for Trend Research, an internationally renowned economic forecasting company, the rates that exist today present huge opportunities. Beaulieu states, “Fast forward 10 years. What do you wish you had accomplished when interest rates were so extraordinarily low? Come back to the present and make your move.”
Money is readily available for owner-occupied buildings, even if they have some lease space for future expansion. The Small Business Association 504 program is a prime vehicle for funding these projects.
There are existing buildings on the market, but you must be persistent and ready to make a quick decision when the right opportunity comes along. Bank-owned properties are selling for a fraction of their value. But how does a business owner make this into an opportunity?
The first steps to determining the right purchase price are a detailed plan, a condition inspection and a cost to remodel the building to fit the needs of your business. Only then can you can negotiate from a position of strength. A highly experienced design/build construction firm can be a major asset in your negotiating process.
While it seems like there is land available, not all parcels are created equally. There is much due diligence required in determining if a piece of land is a good deal. Are there storm water issues that could impact your project? Could changes to regulations for site development impact the financial feasibility of your project? Ultimately, there are tons of options, a few of which likely lead to a dead end. You must do your homework upfront to make sure you strike the best deal.
Buying right is the key to building your personal wealth. The problem is that price is impacted by a lot of variables. Business owners need to be thinking beyond the immediate price. They need to be thinking about all the things, big and small, that can impact the final cost of an ownership opportunity.
The last thing a business owner needs in this environment is to take on more risk. Smart, well-connected design/build contractors and the professionals they work with will effectively manage and shoulder your financial risks.
Become the landlord for your company. Act now and move forward decisively. This allows you to build your personal wealth in a safe, predictable way. After all, isn’t that one of the reasons why we are in business, to help build our personal wealth?
Ron Frederiksen is the president and owner of RSV Building Solutions. He can be reached at 360-693-8830 or email@example.com