Why should a professional buy versus lease office space?

Investment
Purchasing business real estate transforms one of an organization’s largest operating expenses into an asset. Historically, real estate assets held over time will appreciate in value, creating the potential for wealth and/or retirement. Many professionals will actually purchase more space than their current needs require, leasing unused portions to produce rental income.

Control
Businesses and medical practices have a new level of control through commercial real estate ownership. No longer subject to a landlord’s whims, an owner is freed from the prospects of rental rate increases and a forced relocation if their lease is not renewed.

Customized Space
By purchasing, owners can enjoy customizing and upgrading their space without the risk of paying for improvements in a landlord’s building. Interior spaces can be designed to maximize functionality and create the desired corporate environment.

Numerous industry surveys indicate that business clients and medical patients form strong initial perceptions of an organization from the quality and appearance of the entity’s business real estate.

Stabilizing Costs
Ownership payments are comparable or often less than lease payments for similar space, and typically prove to be more cost –effective in the long-term. Real estate holdings offer the added advantage of important tax benefits.

Owners have control over their own operating and occupancy expenses, which allows for tighter fiscal forecasting.

Ownership without Maintenance
Office/medical condominiums offer the advantages of ownership without the hassles of maintenance. Most ownership associations assume the responsibilities of building maintenance, landscaping and security.

Flexibility
Instead of being locked into a long-term lease and obligated to rental payments, the ownership of business real estate provides flexibility to occupy the space, sell all or part at a future date, or lease the space to other business or medical tenants.

Which type of business or medical practice is best suited to ownership of their real estate? What characteristics do they have in common?

Typical business real estate owners include: physicians and other medical providers, dental professionals, lawyers, architects, engineers, accountants, financial planners, insurance agents, real estate firms, trade organizations, consultants and non-profit organizations. Any small- to mid-sized business that has a stable staffing structure or can generally predict their future office space needs is a likely candidate for ownership.