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Planning to construct your own commercial property? Know these tips and tricks

Posted On Friday, 24 July 2020 21:13

Attractive returns together with long-term leases explain why so many investors choose commercial property. With due diligence and wisely investing, you can minimize your risk and avoid potential losses. If a brand-new build is on the cards, you should be careful. Besides the fact that commercial real estate doesn’t come cheap, the project requires considerable capital and time. Many unforeseeable events can take place, so you need to make sure you’re making the right moves. Consider the following tips and tricks if you’re constructing your own commercial property. 

Assess options and prepare a plan 

Building your own commercial real estate property requires a substantial investment of time and other resources. This is why you must think of things carefully before making a decision. You have to keep the site running smoothly, safely, and on schedule. Even if you hire a project manager, it’s still necessary to be involved in daily decision-making, which will undoubtedly take you away from your current operations. The main advantage of constructing your own commercial property is that you get what you want. It’s up to you to identify the land, find an architect or a builder, and select every element of the new structure. 

Several options are available in terms of real estate, such as renting office space, buying another building, or renovating an existing one. The work should satisfy the design intent. Most importantly, take into consideration your long-term needs. Something may change and will require you to alter your plans. Uncertainties will limit your plan’s initial detail and precision. You may find yourself outgrowing earlier than expected. Look over the initial plan once again and modify future work as necessary. The construction plan isn’t a static document, meaning that it should be updated and developed as things change on the project. 

Estimate project costs based on budget and resources 

Creating financial projections is absolutely essential given the fact that the commercial building implies such a great financial investment. Determine the affordability of your project. Cost estimation will enable you to predict the utilization of resources and determine associated costs so that you have a guarantee the project will be completed on time and within budget. Any insignificant task should be included in the financial picture. The project should remain financially feasible and cost overruns shouldn’t take place. The last thing you want to do is to endanger your businesses’ financial health. 

The commercial property construction cost estimate will deploy the same elements as any other project. To be more precise, we’re referring to the following elements: 

• Equipment costs
• Quantity takeoff
• Labor hours & rates
• Material prices
• Subcontractor quotes
• Indirect costs 

It seems like a cliché, but history has the tendency to repeat itself. So, look at the construction industry as a whole and forecast what is likely to happen. If others have fallen short or exceeded the allotted budget constraints, you should reduce your spending or, on the contrary, be more generous with your financial resources. 

Obtain the necessary permits

For new commercial developments, it’s paramount to get a building permit application, but that’s not all. You’ll also need building plans, a site plan, which are to be submitted to the commercial construction department for review. Make sure that you’ve met all local rules since the beginning of the project. Yet again, the rules vary based on whether you're building commercial real estate property, modifying an existing place, or simply changing the appearance of a building. Economies have implemented good practices in terms of dealing with construction-related permits, setting clear and coherent rules so as to enhance transparency and accessibility. 

Chances are you may need environmental clearance. The government decides to give or not to give clearance for installation and modification of certain projects. If your project will result in environmental pollution, environmental clearance is mandatory. Those involved in realty projects can procure environmental clearance within 60 days tops. The process has been simplified to increase investments in the real estate sector. The process comprises a couple of steps, namely: 

• environmental impact evaluation
• conduct of public hearings by the state pollution boards
• obligatory adherence to certain terms of reference 

Since you’re erecting a commercial building, there will be a stricter inquiry from the government, not to say there are many regulations to adhere to. 

Hire an excavator 

The one piece of equipment that is paramount to a construction site is the excavator. Excavators, as well as excavator attachments come in many sizes, shapes, and functions. Getting a good understanding of what an excavator can do and what the specific attachments are used for makes it possible for you to make informed decisions on what piece of equipment to hire. Arms, booms, and hydraulic cylinders allow the excavator to be used for digging and holding debris. The most common attachments are the buckets, which facilitate digging and scooping. Make sure the right machinery is used for the project. 

Operating any kind of heavy equipment poses certain safety risks, which is why people need to receive adequate training. It’s important to avoid unnecessary sudden moves while operating in the excavator. What is more, it’s necessary to check the site plans and get in contact with local utility companies. Failure to do so can lead to considerable consequences. It’s recommended to consult with the project manager before making a decision regarding the choice of the excavator. It needs to get the job done, having enough power for the operation. If it doesn’t have the right functionality, it won’t get the job done right. 

Get a good architect or designer  

If you have a contractor or designer, you might be wondering if it’s necessary to hire an architect for the project. When it comes down to designing a commercial space, very few comprehend the importance of hiring a building architect. Having a professional by your side is necessary because they can help you navigate through the countless design options, zoning laws, and so on and so forth. The building architect monitor’s the construction process to make sure that everything goes according to plan and meets your expectations. Hiring a building architect is a worthwhile investment. 

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