Friday, May 18, 2012

Beyond The Asking Price - Space Planning

Still on the ‘buy side’ and putting aside all of the analysis on valuation & pricing, it is time to do some planning… more specifically space planning. This part of the exercise will apply to any of the alternatives you might be considering on your property short-list.

If you intend to occupy the building being purchased (either all or part), it’s a good idea to prepare a graphic outline of how the space needs to look for your business purposes. A proper plan reflects wall/door locations, room sizes/labels, hallways/baths/common areas, and even furniture layouts.

Specifically your requirements might include the following:
i) reception/waiting area
ii) meeting/boardrooms
iii) administrative/ ullpen areas
iv) designated offices
v) kitchen/baths/storage areas
vi) handicap accessibility (NB : review most recent building codes applicable, to determine any retro-fit requirements)

Once you’ve done the planning and determine the necessary changes needed, it is time to do some ‘costing’. This will increase the price of the property acquisition accordingly, and it should be accounted for prior to finalizing any bid on a property. Often times, this becomes the difference between alternative buildings, in that the actual ‘turn-key’ price can favour one property over the other.

As a further note, this exercise can be included within a 'Due Diligence' condition within an offer, and should be dealt with on that basis, given the importance of planning your operation within a new location. Good planning usually yields good results - and when acquiring a commercial building, it is well worth the effort.

Next up… examining the overall physical condition of a building/property which you are considering..

Again, seek out experienced commercial realtors within your market to assist in acquiring the right building fit for your business needs.

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