What does it take when Building Commercial Real Estate?

Building a commercial real estate property is not an easy task, and there are alot of moving parts. Step 1 is identifying the land in which you want to build upon. With your commercial real estate broker., the process gets alot more detailed and potentially complex.  This series is provided as an educational foundation to help buyers identify the various areas of potential concerns. It also summarizes facets and processes required when building commercial real estate property. Shire Commercial represents the buyer-developer typically in this type of transaction.

Developing Commercial Real Estate

Below you can view part 2 of a series of development video interviews done with Larry Nelson of Nelson Development Company in Austin.  Let’s hammer out some commercial real estate building bullets. 

• Timing – your personal income picture.  Look for declines in inflation and unemployment declines. Demand is on the increase in your target city. Major economic incentives and population increases.
• Location analysis and zoning reviews
• Site Details- you can understand more about this in the video below
• Marketability – Due Diligence Studies. Make sure your project has good site quality, convenience, and exposure.  There are also technical considerations such as size, environmental, utilities and traffic patterns to understand.

Poor Decisions

Making a bad decision about building commercial real estate is obviously something you want to avoid. Here are some things to not ignore when you are digging into due diligence.

• Selecting a weak strategic position in a highly competitive market
• Access- having a new location that is not easy to find or access
• Locating next to low income developments
• Having a location that can be out-positioned by a competitor
• Not bothering to find out why there is no competition?
• Locating near retail that doesn’t operate within the same hours you operate. This means they close earlier that you do.
• Ignoring demographic reports that show you do not have the right customer base.
• Not understanding the Permitting process

Module 2: Interview Regarding Build to Suits  (time 10:45)

The following interview continues with Larry Nelson of Nelson Development Company regarding build to suits for commercial real estate.  In this module we are going to review the following attributes:

• Sub Surface issues
• Contours of the commercial real estate property (land)
• Coverage dilemmas
• Potential environmental concerns
• Utility availability
• Build To Suit Module 1 video