Business to Business | BABM Business Magazine

• Cost is key in your investment, whether you plan to occupy the building yourself or lease to a tenant. Beware of being under-capitalized; never invest your entire business budget in the store. A percentage of funds should be set aside for maintenance, utilities, equipment, employees, marketing, etc. Your real estate agent will tell you how this building compares in price to others of a similar size, structure, age and condition and should supply you with a history of previous occupants. You will want to know why the building is up for sale and why now.

• Your contractor will make a thorough inspection and compare the cost of repairing to meet current Florida building and fire prevention codes, as well as implementing cosmetic and practical renovations, versus starting from scratch. An advantage to buying an existing building and remodeling it is you don’t have to get involved with civil engineering. Your project will not require a new construction site plan approval, which otherwise could add months to the permitting process, and as they say: “time is money.”

• Just as with a residence, LOCATION, LOCATION, LOCATION of a building is important. The land use you are considering should match the zoning of the area and be compatible with other businesses. You wouldn’t put a daycare center in a row of taverns. The zoning can be determined by contacting the nearest municipality. Be sure to ask if there are any zoning changes pending, or issues with eminent domain. For instance, it may turn out the property in question is in unincorporated Pinellas County (don’t assume the town listed in the address is correct).

• Consider the traffic patterns. If the building is near a busy intersection, is this a good thing, or a bad thing? Are there any plans on the books for new building construction that may further increase traffic congestion, or is road construction scheduled for the future, such as widening lanes, laying pipes or cables, or any other activity that could inconvenience and delay prospective customers?

• Entrances and exits could be problematic. Does the customer have direct access, or is there a U-turn involved in getting into or out of the parking lot? As for the parking lot, is it in good condition, will it need to be repaved or reconfigured, and does it have an adequate number of spaces, including handicapped spaces? An advantage to buying a pre-existing structure is that if the building’s use will be similar to the former occupant’s, chances are it is in compliance, and both the transportation impact fees and water and sewer impact fees already have been paid.

• Do your homework and know if the building is in a flood plain. This could affect your ability to get insurance. If you are planning additions to the building, the new area cannot exceed more than 10% of what already exists. Adding more than 10% will require a new site plan and could add months to the permitting process.

• Signage at the site may have been “grandfathered in” for the previous owner, but you, as a new owner, will be subject to the current codes. Some codes enforced are related to aesthetics, while others are necessary for weather conditions. The newest electric and flashing signs are attractive and eye-catching, but limited as to size, color and frequency of text. Signs can be costly to purchase and their installation may require an insured technician, but it is important for your building to have exposure, so leave adequate room in your budget for that.

To Buy, or Not to Buy?