There is a piece of property that is for sale that is an empty warehouse building that is zoned for commercial and residential use.The property is located in the Central Virginia area that is surrounded by old warehouses that have been transformed into either all apartments or apartments and merchant store fronts.I am trying to figure out how to evaluate the property.
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What did the warehouse used to be used for and how long has it been vacant? Why has it been vacant while other buildings have been converted first? What are you ideas for the property? Do you plan to convert it or tear it down and start anew? In either case, you need to determine how much it will cost to purchase the property (including closing costs, due diligence, etc.) + cost to convert or build new. Using comparables, figure out about how much you can get when renting the building minus vacancy. Determine if your approximate rent minus expenses is an acceptable return on your investment.
Biggest issue if the warehouse is old for adaptive re-use is does it have asbestos and are there any environmental issues with the property?? Back in the old days many of these businesses would illegally dump materials instead of disposing the proper ways.
If there is remediation needed check with city, county, state, federal for possible grant money to offset. The benefit to an old vacant building is generally the city or county will get behind your project. The reason is the building is an eyesore that is not generating any revenue taxes or much property tax for the local government. Also with a vacant building no jobs impacts to the economy.
This is generally an easier sell than you want to build on beautiful and open natural wooded areas where you will get fights from the tree huggers and community at large.
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