Few companies begin their business as a large entity and buy their own property for offices or industrial space. These small businesses do not have the funds for capital investment until their company has found its place within the market. Rather than struggle with a mortgage, many of them find commercial property leasing ideal. They may have to pay a high monthly lease fee for their space, but maintenance is generally included, and the lease is often tax deductible. This works well for the business and the property owner.
Commercial property has always been fairly expensive because most businesses need a prime location. They tend to prefer space in the heart of a city or town. Even beltway businesses, on the edge of a large city, have a prime location. Passing traffic is one of the best ways to earn business with fewer advertising dollars. Location is also important for those that need easy access to a business. If there is a major road nearby, there is a better chance to attract more customers.
Large investors concentrate on commercial property investment. The lease rates are much higher for businesses than for living space. They also tend to take less maintenance because most commercial buildings are not used around the clock. Businesses seldom have any reason to damage or abuse a property, and this helps keep maintenance costs low for the investors.
Businesses generally grow over a long period of time, and this is another boon for commercial property investors. A business that begins in a small office may not need additional space for years. Commercial property investors generally own several locations, and they may be able to accommodate a growing business in another property. This gives them the added security of a reliable tenant with a history through their company.