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Commercial and Industrial Real Estate Terms to Know
Whether you are listing a property or looking to purchase office space, a real estate agent that specializes in commercial and industrial transactions can help. For buyers, a professional agent or broker will be familiar with property listings in the area, average rent or lease rates, and finding the best building for your needs. For sellers, an agent can create a listing, appraise value, and show the property to prospective tenants. Here are some real estate terms that may be necessary to know before any transaction.
Industrial Property – A commercial property used for production, manufacturing or distribution.
Building Classifications – Office space and industrial-use properties are classified A, B, C or D based on their quality, age, condition, location and market appeal. A grade of ‘A’ being the highest.
Escrow Agreement – A written agreement between a real estate buyer and seller than specifies the obligations of both parties, and any funds to be deposited in escrow to cover the related costs of the sale.
Security Deposit – In a rental arrangement, a payment made to a landlord or property owner to secure the lease. This deposit should be refundable when the lease has ended.
Comparables – The purchase or rental costs of similar commercial or industrial space in an area. Buyers use comparables to rate the value of the property they wish to lease or buy.
Flex Space – A building that allows occupants options in dividing up space as needed, such as between office and showroom, or showroom and warehouse.
Percentage Lease – An arrangement between a property owner and renter, in which the owner is paid a percentage of the tenant’s gross sales as part of the rent.
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Commercial real estate is for sale in various parts of the United States. There are numerous licensed agents that specialize specifically in this type of property. Just so you know, commercial real estate is essentially office buildings, small shop spaces, and other business listings. While some people invest in this type of property, other people lease it in order to start a business or company of their own. For instance, someone may purchase a small commercial space in order to open up a retail clothing shop.
As you may know, different commercial real estate brokers handle or manage the sales different properties. Typically a buyer must take out a mortgage loan in order to buy a commercial office building or piece of land. Some commercial spaces have park views or lake scenery that makes them more valuable. Depending on the market and the location of a property, the cost may vary greatly. Typically a professional will have to appraise the commercial real estate in order to determine how much it is worth. This will also determine how much a bank will lend the buyer for the property. Many people hire commercial real estate agents on a short term basis in order to help them find the right room or office space development.
You can learn more about commercial real estate agents, and the conditions that apply to purchasing commercial properties by contacting experts in your town or city. This way you can make any inquiries you feel are necessary over the phone.