6- Methods to Increase Your Commercial Property Value

Owning commercial real estate involves maintaining the property’s order and maximizing its value. This can greatly impact the property’s value and the productivity and efficiency of the tenant businesses.

Raising the value of a commercial property can bring many advantages for landlords. A higher-value asset can attract more consumers and renters to the market, leading to an increase in its total worth.

Finally, property owners can receive tax benefits based on the increase in the value of their assets. In this blog, we will discuss six methods to increase the value of your commercial property.

Make Strategic Improvements and Renovations

Strategic property improvements can range from surface cosmetic enhancements to substantial structural rehabilitation. Examine your area from a distance, or even better, bring in an experienced and neutral third party to assess it. Exterior Paint Coating, decoration, and new flooring are aesthetic improvements. You can apply a fresh coat of paint to an older warehouse, new decor elements to a large office building, or new flooring to spruce up your building.

New or updated landscaping of the property is an effective approach to draw in new potential customers through your doors. And structural enhancements or major renovations, like refinishing a retail strip center’s facade or integrating modern amenities, can be a significant factor in attracting a new tenant. Remember that the key word here is “strategic.” Making smart renovations that yield a smart return on your investment is crucial.

Enhancing Energy Efficiency

In the current era of increasing environmental awareness, improving the energy efficiency of your commercial property can significantly increase its value.

Energy-efficient properties decrease operational expenses and attract eco-conscious renters and customers.

This can include fixing LED lighting, adding solar panels, enhancing insulation, or upgrading to energy-efficient devices. For example, solar panel systems installation can generate electricity for properties, reducing energy costs and offering a unique selling proposition to attract tenants.

Minimize Expenses

In addition to increasing revenue, another approach is to reduce expenses. It’s not surprising that the operational costs of a building differ depending on the type of commercial property.

The expenses for an office or marketing space differ from those of a multi-family structure. Moreover, numerous expenditures shifted to renters in commercial properties, divided between leaseholders and landlords. By reviewing your operating expenses, you can identify areas where you can increase commercial property value.

Fortunately, there are numerous methods available for achieving this.

Add Amenities or Explore Income Producing Ideas

Amenities you might add include in your building are:

• concierge services
•  a fitness center
•  a conference area
• a business center with a fax machine and copier
• a coffee bar
• Wallpaper install to enhance interior aesthetics

Some common income-producing ideas include:

• leasing your roof space for cell towers

• incorporating a laundry room and coin-operated machines into an apartment.

• renting your common areas for events like art shows, auto exhibits, or children’s rides.

Change the Building’s Purpose

A strategic change in a building’s purpose can substantially boost its value and appeal to potential tenants or buyers.

Suppose a conversion might be a smart option if your property is now used as an office space, but the area can benefit you as a shopping center. Alternatively, repurposing an underutilized industrial warehouse into a modern co-working space can help align your property with current market trends.

But before these big alterations, a detailed market examination and evaluation of zoning laws should be conducted, as these significant adjustments will affect the area’s wider economic and demographic trends.

Optimize Property’s Operations

Optimizing the operations of your commercial property can greatly increase its value. This can entail implementing energy-efficient systems, decreasing waste, or simplifying administrative procedures to reduce working expenses. Lease administration is also another essential place to save money. 

Landlords and property management businesses often cover expenses tenants should be responsible for according to their leases. A commercial property manager can help you detect areas where your property’s procedures might be enhanced. Managers can also collaborate with you to implement changes that may save costs and boost profitability.