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What do you need to consider when buying commercial real estate?

by | Dec 9, 2022 | Commercial Real Estate

Commercial real estate law in New York doesn’t offer as many protections as residential real estate. Buyers must read leases carefully and negotiate problematic clauses or walk away from the property. Location, space and budget are other factors that play a role in your purchase decision.

Location and space

You may want to reflect on what features are important to you in the workspace. Remember to consider both the internal and external features. If working in silence is important to you, then a quiet location is ideal. The walls of the building may need to have good noise insulation as well.


Commercial real estate usually requires a down payment of 10%–40% of the property’s value. If you’re not able to afford a down payment, then you can look into leasing instead of owning. You need to make a security deposit to rent a space, but it would be less expensive than a down payment. When you set your budget, don’t forget about maintenance and unexpected costs. Repair needs are going to happen with any type of property. You will want to set aside money to handle possible repairs that might be required.


It’s possible to lease part of a commercial property to others to help you in covering the costs. There are commercial real estate laws to follow if you lease to others just as with real estate. You need to make certain repairs within a specified amount of time.


Buying a property gives you more control over it than leasing. However, there are still city codes to abide by. You might have some noise restrictions or renovation limitations, depending on where the property is located. It could be possible to obtain permission for certain business activities and renovations.


If you care about equity in your commercial real estate, then owning is the route to go. You can only build equity as an owner.

Because New York doesn’t offer as many protections when it comes to buying or renting a commercial property, you may want to ensure that you fully understand the terms and conditions. City laws influence what you can do with a building in certain neighborhoods. It’s important to not set a budget higher than you can truly afford as well.