Buy, build or lease?

4 Replies

Hi there, I have a quick question. 

I am doing a feasibility study on a small business that will sublet small offices to small companies and professional services. Is it best to build or retrofit? Obviously, there is a huge price difference but in looking at the long-term my payments only pay down someone else's investment. It has been suggested to me that I retro a local building and after 5 years of profit, I can look int a build. Can anyone shed some experience on this?

Thanks, - James 

In that case I’d probably rent first to see if the buisness is actually going to be successful before buying.  You could probably even start out of a home office.  I can’t imagine there is much demand for commercial subletting though.... have you done any research on this?

@Dick Stevens I am at the very beginning stages of the study ( This isn't my usual gig but the co-founders are friends of mine ). It literally is a blank notebook at this point. I am looking at a potential of 15 tenant offices to start. I am working backward from an approximate lease commitment with a very high estimate of extra expenses ( and I am sure I won't get everything ) to give me a go forward price target. We are looking at self-managing so that should help with expenses.