The St. Paul-Minneapolis area is an attractive place to invest in commercial real estate for a variety of reasons. The Twin Cities have a diverse economy, with an array of industries ranging from healthcare and technology to retail and manufacturing.
With its vibrant culture, diverse population, and excellent quality of life, the Twin Cities provide an ideal setting for most businesses to thrive.
The area also has a strong real estate market with plenty of available commercial properties. Minnesota commercial real estate is one of the most attractive markets in the country right now, offering great potential returns on investments.
Additionally, there are 17 Fortune 500 companies around the St. Paul-Minneapolis area. Couple that with the fact that the Twin Cities grew in population by 314,000 people between 2010 and 2020, and you’ve got a perfect situation for purchasing commercial real estate.
Are you thinking about investing in Minnesota commercial real estate? Here are six best practices to abide by to save you money and ensure you’re making a smart decision.
1. Determine Your “Why”
When considering buying commercial property for investment purposes, you should first evaluate why you want to invest and what you hope to achieve. Understanding your goals and keeping them in mind throughout the entire process will help you make smart real estate decisions.
Some common reasons for investing in commercial real estate include…
- Generating rental income
- Growing investments through property value appreciation
- Reaping tax benefits
- Diversifying investment portfolios
By determining your reason for investing in commercial real estate in Minnesota, you will better understand what type of property you should purchase. Different properties can fulfill different needs and achieve different goals for their investors. What kind of property do you need?
2. Find a Minnesota-Based Real Estate Broker
If you're looking for commercial real estate in Minnesota, it pays to work with a respected broker – literally. With the help of a knowledgeable and experienced broker, you have the chance to explore all of your options and find the right property for your business needs.
A respected commercial real estate broker in Minnesota will provide you with access to the latest listings, giving you the best chance of finding the perfect property for your needs. They will also help you ask the right questions, advise on industry trends, and provide helpful insights into local markets.
A real estate broker is a licensed professional who works as an intermediary between buyers and sellers of real estate. They are responsible for helping clients find properties that meet their needs, negotiating contracts, and ensuring that all legal requirements are met. They will also provide advice on financing, taxes, and other related matters.
Local real estate brokers have extensive knowledge of the surrounding market and will help buyers or sellers make informed decisions about their investments. You don’t want just any broker – you want one that specializes in Minnesota’s commercial real estate space.
3. Secure Financing Ahead of Time
It’s best to have your finances in order before looking at commercial properties. Without a solid funding plan, you may end up in a position in which you cannot put an offer on the table in time to secure a property you want.
Take the time to calculate your budget and secure financing so you can put an offer in as soon as the right property comes up. Applying for financing before you start shopping for commercial properties can also help identify any potential problems early on, then address them before the purchase.
4. Focus Heavily on Location
There’s a reason you’ve heard the phrase “location, location, location” so many times.
In Minnesota, commercial real estate can vary significantly depending on the area. Make sure to take the time to research and understand the local market so you can zero in on your ideal location, without wasting your time looking elsewhere.
Location can influence factors such as cost, accessibility, and potential customers or tenants. For example, properties near high-traffic areas, like Bloomington or the North Loop, may be more expensive but offer greater visibility and customer access. On the other hand, properties located in less-traveled areas may be cheaper but have fewer potential customers or tenants.
You’ll also want to consider future development plans in the area when selecting a commercial property in Minnesota. This will ensure that you are investing in an area that will continue to grow and thrive over time.
5. Heavily Evaluate Your Risks
When assessing available properties in Minnesota, consider the potential risks associated with each property. You’ll want to evaluate the property’s location, condition, and any other factors that could potentially cause issues down the line.
By thoroughly evaluating the risks associated with each property, you’ll see if the property is truly a good investment – or if it will jeopardize your portfolio.
When looking for commercial properties, exercise due diligence to make the best decisions. A good real estate broker will help you achieve this by providing you with the necessary information and advice. They will also provide you with an in-depth analysis of the property and its potential, including market trends, pricing comparisons, and other important factors.
6. Close the Deal Carefully
When you finally make your offer, you want to make sure you’re doing it right. Rushing into a deal can sometimes create risks of overlooking red flags or neglecting to cover all of your bases.
There are a few important questions that you need to ask yourself, like “do we need to include contingency clauses?” and “are all of the documents reviewed and in order?”
This is when having an experienced commercial real estate broker really comes in handy.
They will help you ask the questions needed and make sure that no stone is left unturned. They also have access to a vast network of resources, such as lenders, title companies, appraisers, inspectors, and more that can help speed up the process.
Shopping for Properties in Minnesota? Let Us Help.
When it comes to finding the best commercial real estate in Minnesota for you, there’s no substitute for the guidance and help of an experienced broker. With professional services, you can fully explore all of your options and find the right property for your needs.
Gonyea Commercial Properties is a full-service commercial real estate firm committed to helping clients achieve their real estate goals in efficient, cost-effective manners. We have been in business for over 30 years and boast an experienced team of professionals.
By leveraging our experience in the industry and a deep understanding of local Minnesota commercial real estate, Gonyea Commercial Properties will help you find the perfect property. Call today to get the process started.
