Owning commercial property as a small business is a major responsibility—but the rewards are worth it. Unfortunately, many small business owners don’t even consider owning commercial property because the cost of a down payment is just too high.
This means that investors often scoop up small business real estate and leave the local owners in the dust—rising rents and changes in landlords cause many businesses to close shop or be displaced from the very neighborhoods where they created so much of the property’s value in the first place.
At withco, we’re working to level the playing field by offering a lease-to-own model that is simple and affordable for small business owners so that they can reap all the benefits of commercial property ownership, from securing their space to generating wealth. Below, we break down all the ways small businesses can benefit from commercial property ownership.
Secure your space and future
Never worry about being displaced again. When you own your property, you’re in control of your space and your business’s future–no third party or commercial investor can come in and raise your rent or refuse to renew your lease.
Control over building maintenance
Tired of waiting on your landlord to come fix something? Want to make upgrades to your space that will help your business thrive, but the property owner doesn’t approve? Owning your space means you have more control over how your space is maintained and you’re able to make the upgrades your business needs to reach its full potential.
Reduce operating costs
When you own your property, you have more control over your business’s operating costs. A mortgage often costs significantly less than rent, and you’re able to more easily manage other operating costs like monthly taxes and utilities (especially if you were previously in a full-service lease structure). Want to lower your electricity bill by making your space more energy efficient? The space is yours to run how you see fit.
Diversify your financial portfolio
The more diverse your assets, the healthier your financial portfolio will be to hedge against risk. While we never want to assume that a business will fail, unfortunately, we can never predict the future, and if all of your money is invested in your business alone, you won’t have much financial recourse should your business fail. But if you own your commercial property, you’ll at least have one more asset with value that can be leveraged.
One of the best aspects of owning commercial property is that it almost always gains value over time. In other words, your property will likely be worth more money 5, 10, 20 years down the line than when you first bought it. This means your overall net worth will continue to appreciate by simply owning the property. This type of asset can be passed down between generations, securing future wealth for your family.
Leverage property for access to capital
Need some cash to invest in your business? The value of your property can be used as a lien to take out cash loans. You can also always refinance your mortgage to access more capital for your business. As they say, sometimes it takes money to make money.
Generate additional income
Owning commercial property makes it easier to generate income from the property itself. Maybe there’s a back parking lot you never use—as the owner, you could lease the back lot to another business and put the rental income towards your mortgage. You can also lease wall and air space for advertising other businesses and services. The possibilities are endless.
Strengthen your local community
As a property owner, you aren’t just investing in a building–you’re also investing in the community that surrounds it. Empty storefronts and high business turnover are bad for local businesses and their communities, but by ensuring your business has a property it can remain in for the long-term, you are directly impacting the health of your neighborhood in a positive way.
There are so many benefits to owning your commercial property, and now, it’s easier for small businesses than ever with withco’s lease-to-own model.