Author:
Diana Heeb Bivona Deciding to take out a loan to cover a real estate purchase, regardless of whether it is a $500,000 residence or a $15M office building, is a major, often ulcer-inducing experience for many. For all the discomfort and worry though, there are several benefits to taking out a commerical real estate loan including:
Interest on the commercial real estate loan is tax deductible
You can take annual depreciation deductions on your taxes
In the long run, you’ll probably come out ahead because you won’t be facing rent increases
You’ll benefit financially if the real estate market is good when you sell
You may be able to lease out a portion of the building if you determine you have excess space
If you need to make substantial changes to the building to accommodate your business, those changes are owned by you rather than your landlord
Determining if a loan is the right way to go requires a look at several factors outside of just your individual financial circumstances. Start by doing your homework. Performing a detailed cash flow analysis. Also review current trends and future predictions regarding your local market. Arming yourself with information and solid research can make a world of difference not just in your own mental well-being, but in choosing a right loan package to meet your needs.
This entry was posted
on Friday, December 15th, 2006 at 7:15 am and is filed under Commercial Real Estate.
You can follow any responses to this entry through the RSS 2.0 feed.
Responses are currently closed, but you can trackback from your own site.
