Longmont , CO
(720) 600-9513
Longmont , CO
(720) 600-9513

6 Benefits of Hiring a Commercial Real Estate Broker

Category: Buying

6 Benefits of Hiring a Commercial Real Estate Broker

June 20, 2023

The world of real estate can feel like the Wild West. There are many different ways to navigate the buying, selling, and leasing process, and some try to do it all on their own.

In commercial real estate, it is common for businesses and individuals to go unrepresented when looking to purchase or lease. Some consumers simply don’t understand the advantages of partnering with a commercial real estate broker. 

Working With a Commercial Real Estate Broker

Let’s dive into a few reasons why working with a commercial real estate broker is the right decision. 

  • Time: Allow your commercial real estate agent to do the heavy lifting! They will search for properties, set up showings, and prepare contracts on your behalf to save you time. 
  • Money: Hiring a broker does not always mean money directly out of your pocket. Often commissions are paid based on the lease amount or purchase price and are normally paid by the seller or leasing landlord. 
  • Negotiations: Negotiating a real estate transaction is a skill. Your agent knows the tactics to secure the best terms possible and save you money. 
  • Legal: Commercial real estate contracts are complicated and have legal consequences. Having an experienced professional to explain the nuances is key. 
  • Data: Your real estate agent has access to many search engines and market stats you will need to make a well-informed decision. 
  • Knowledge: A broker’s general knowledge of the industry, your local market, and real estate contracts will ensure you stay on the right path. 

Hiring a Professional You Trust

Hiring a professional that you trust, who will work in your best interest throughout the transaction, will make the process seamless. Please contact Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 regarding any commercial real estate needs in Longmont, CO, and our neighboring communities.

We give out $250 gift cards for referrals that become our real estate clients.

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Deferring Taxes Using a 1031 Exchange

June 6, 2023

When you sell a piece of real estate, you may need to pay capital gains tax on the proceeds. Capital gains tax payments can be hefty in commercial real estate, where price tags are often significant. 

To avoid paying taxes immediately following a sale, some investors choose to use a 1031 Exchange. 

What is a 1031 Exchange?

A 1031 Exchange is a tool used to defer taxes. It doesn’t eliminate tax payments; it simply allows investors to pay capital gains tax at a later date. When using a 1031 Exchange, an investor can sell a piece of real estate and use the proceeds to purchase another property of like kind without paying taxes on the gain. 

Deferring taxes in this way allows funds to be reinvested in a new asset and continue to grow without a tax penalty for many years. The new property must be of greater or equal value, and the purchase must happen within a specific period to qualify. 

Regarding commercial real estate, your business could sell its current office space and purchase a new office (of greater or equal value and within the specified period) without paying taxes on the proceeds from the sale. Ultimately, it means keeping more money in your pocket to continue investing.

What’s Your Strategy?

The first step is determining your investment strategy. Your commercial real estate agent can help guide you based on their experience and the type of real estate you hope to invest in. Depending on your goals, a 1031 Exchange may not be the best option, but it’s a highly beneficial tool to implement in the right situation. 

Please contact Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 regarding any commercial real estate needs in Longmont, CO, and our neighboring communities.

We give out $250 gift cards for referrals that become our real estate clients.

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Types of Financing in Commercial Real Estate

May 24, 2023

As with purchasing residential property, there are various types of financing in commercial real estate. Each lending category has different terms and requirements that may or may not benefit specific buyers. 

Knowing your financial situation and goals is crucial in selecting the correct type of financing for your commercial property.

Types of Financing

The following are a few of the most common types of financing in commercial real estate.

Term Loan

A term loan is a lump sum repaid through periodic payments over a given loan term. This type of financing is what most people picture when they consider taking out a loan and is the most common type of lending in commercial real estate. 

Bridge Loan

Bridge loans are typically used as interim financing options until a long-term loan is secured. For example, if a business needed to move to a new property, they could use a bridge loan to purchase the new building (without selling the current property first) and then refinance into a term loan or SBA loan after the original building sells. 

SBA Loan

SBA (Small Business Administration) loans are government-backed loans given to businesses that meet specific requirements. Government-backed loan products mean less risk for lenders; therefore, you receive a lower interest rate on an SBA loan than other financing types. 

Hard Money Loan

Hard Money Loans have shorter terms and are used to finance properties that do not qualify for other types of lending. These loans typically have higher interest rates and fees due to their risky nature and are repaid on a shorter term. 

The Best Loan For You

Finding the best loan for you is one of the most essential steps in guaranteeing success in a commercial real estate investment. Your real estate broker will guide you toward the best organizations to talk to for your commercial lending needs.

Please contact Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 regarding any commercial real estate needs in Longmont, CO, and our neighboring communities.

We give out $250 gift cards for referrals that become our real estate clients.

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Four Benefits of Real Estate Investing

February 14, 2023

Some investors want to own a large portfolio of cash-flowing properties. Others only own their primary residence and don’t consider themselves investors at all. In reality, if you own any piece of real estate, no matter the type, you are an investor.

Let’s take a closer look at the four benefits of real estate investing.

Cash Flow

Cash flow is the big one on which many investors focus. For example, if you own a rental property, you want the rental income to be greater than any associated expenses (mortgage, maintenance costs, insurance, etc.). You aren’t cash-flowing if your costs are higher than your rental income. 

Appreciation

Appreciation benefits any and every property owner. It’s likely shocking how much your parents or grandparents bought their first home for versus what the same house is worth now. That is the power of appreciation.

When there is more demand than supply (more people who want to buy property than there are properties available), real estate becomes more expensive as multiple buyers drive prices up. 

Tax Incentives

Mortgage interest deductions, insurance deductions, and depreciation are a few of the tax incentives that come with owning real estate. Some only apply to a primary residence, and some are the benefits of owning rental properties.

Your trusted CPA can help guide you on how to maximize your tax savings regarding your real estate investments.

Debt Reduction

Debt reduction only applies to real estate investors who finance their properties. When you use a mortgage, you put a certain amount of money down and then are left with an outstanding loan balance. As you or a tenant continue to pay the mortgage each month, the debt amount shrinks, and the property’s equity grows.

Ready to Become a Real Estate Investor?

Building your team of local real estate professionals is the first step in becoming a real estate investor. Please reach out to Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 regarding any commercial real estate needs in Longmont, CO, and our neighboring communities.

We give out $250 gift cards for referrals that become our real estate clients.

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WANTED TO LEASE/BUY: 1500-3000 SF INSIDE LOVELAND CITY LIMITS

November 30, 2022

We have a new client who is looking to lease or purchase a small shop in Loveland, CO.   Here are the details:

  • 1500-3000 square foot retail, flex or industrial space for Martial Arts Studio
  • Purchase or 3-5 year lease preferred, but flexible
  • Minimal power, heat and simple bathroom needs
  • Ready to act quickly for the right opportunity!

Please contact me if you are aware of anything that might fit. Thanks!

Steve Longenecker, Broker

Northern Colorado Commercial Real Estate
720-600-9513, WeBrokerCORealEstate.com
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Refer a Client to us and receive a $250 gift card!

Top Trends in Modern Office Building Space

October 11, 2022

Commercial real estate and the use of office buildings has dramatically changed in recent years. Coworking spaces, work-from-home options, and modern technology have created opportunities that the general workforce never had before. 

Overall, standard offices have transitioned to more inviting and collaborative environments. Below are a few of the top trends in modern office building design. 

Efficiency 

As with most newer construction and remodeling, office buildings are making sure to emphasize efficiency when creating unique spaces. Using durable and high-quality materials reduces repair and maintenance spending and cuts down on utility costs over time.

Collaboration

Cubicle walls separate many traditional office spaces at every turn, while newer designs provide space for collaboration. Employees now sit at smaller workstations within a larger open area. Forgoing the heavily divided space allows team members to meet and collaborate easily. 

Visually Appealing 

New office designs include modern furniture and interior elements, plenty of color, open concepts, and abundant natural light. Updated finishes and colors make for an energizing workspace, and the use of glass walls to separate offices and meeting spaces creates a bright environment.  

Built-In Technology

Down to the minor details, companies are designing their offices with plenty of built-in technology. Conveniently placed outlets, projectors and smartboards, and wireless phone charges are keys to creating a thoughtfully designed work area.

Recreation

Beverage stations, ping pong lounges, and nap rooms—Who would’ve thought these features would end up in office buildings? Unique recreation spaces have become increasingly necessary to recruit and keep top talent. 

Innovative Meeting Spaces

Conference rooms and large private offices are a thing of the past. Open concepts allow for team meetings with employees remaining at their workstations. Additionally, updated offices are more likely to feature smaller meeting hubs for a few employees to hold meetings or take private phone calls.

Looking for a New Office Space?

Please contact Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 regarding any commercial real estate needs in Longmont, CO, and our neighboring communities.

We give out $250 gift cards for referrals that become our real estate clients.

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Benefits of Commercial Real Estate Auctions

September 28, 2022

How do Commercial Real Estate Auctions Work?

Commercial real estate auctions can be an excellent alternative to the typical selling process. Usually, a building or piece of land would be listed for sale and shown to buyers. The seller then waits for interested parties to present their offers.

The auction process, however, presents a building to a group of interested buyers simultaneously. Buyers can submit bids during the auction period, and the highest bid is chosen when the auction closes. Some sellers require a minimum or reserve price to be met for the sale to proceed. 

Benefits of Auctions

Depending on the type of property and the seller’s situation, auctions can provide various benefits. 

  • Streamlined Sale Process: The auction process allows the seller to collect all bids or offers from interested parties within a specified time. As opposed to selling on the traditional market, going to auction streamlines the sale process.
  • Equal Playing Field: When all buyers participating in an auction agree to the same terms, there is less chance of an offer being chosen based on agent relationships, closing and possession details, or any other conditions. 
  • Virtual and In-Person: Auctions are held online, in-person, or a hybrid of the two, allowing them to reach a broad audience.
  • Pre-Qualifying Buyers: Often, buyers may need to give information regarding their financial situation and submit non-refundable deposits before the auction begins. Gathering these details ahead of time gives the seller an idea of who is serious. 
  • Transparency: Many times in a real estate negotiation, you may be aware that there are other offers on the table but not know the details. Auctions provide transparency and allow buyers to know exactly with who they are competing. 

Need Help Navigating Auctions?

Don’t hesitate to contact Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 with questions regarding auctions or if you have any commercial real estate needs in Longmont, CO, and our neighboring communities.

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What to Consider Before Your First Development Project

September 14, 2022

What is Commercial Real Estate Development?

Commercial real estate development involves purchasing a piece of land or an existing structure and creating a new facility. This could mean purchasing land and building an apartment complex or buying an old commercial warehouse and renovating it into a wedding venue. 

As you might imagine, the development process has many moving pieces. Some investors shy away from development projects and stick primarily to buying already-built structures. However, when done correctly, development can yield significant profits for willing investors.

What to Consider Before Development

Before beginning a commercial real estate development project, there are a few essential items to consider.

Risk

While the risk of development tends to be higher than simply purchasing an existing structure, it can pay off in the long run. Before developing, be sure you fully understand and feel comfortable with any associated risks.

Financing

There are many types of commercial financing, including lines of credit, construction loans, and portfolio loans. Connecting with an experienced commercial lender will help you determine the right kind of financing for your project.

Building Site

Choosing a piece of land or structure can be one of the most challenging parts of the process. Your real estate agent will help guide you through contract negotiation, zoning regulations, and any necessary inspections. 

Construction

As the developer, it’s your job to bid out and supervise construction. Managing subcontractors can be time-consuming, so it’s important to allot enough margin to navigate challenges that arise through the construction process. 

Sale or Leasing

Finally, when all is said and done, you must be sure you have the right sales or leasing team to market your new development and find the right buyer or tenant. 

Build Your Real Estate Team

Before beginning your first commercial real estate development project, you should spend time assembling the right team. Please contact Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 with any questions or if you have any commercial real estate needs in Longmont, CO, and our neighboring communities.

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Remote Work Impacting Commercial Real Estate

August 31, 2022

Remote work became necessary during the global pandemic and continues to impact the commercial real estate industry. Tenants are looking for different options than they were a few years ago, and commercial property owners are learning to navigate the new normal.

Here are a few trends to be aware of as working from home increases in popularity. 

Digital Nomads

A digital nomad refers to employees who work remotely and use the flexibility to travel to and live in different locations throughout the year. This trend has broadened the demand for short-term rentals and more flexible lease agreements as workers choose to leave expensive cities for other areas.

Co-Living

Co-living spaces typically have individual rooms for rent and shared amenities such as kitchens, living rooms, and working areas. As the cost of renting and purchasing has skyrocketed, co-living spaces have become much more popular. 

With flexible and affordable lease terms, some remote workers have shifted away from renting traditional apartments and are choosing co-living as they explore new states and cities. 

Work-from-Home Amenities

Working from home means people spend much more time in one location and aren’t experiencing the social aspects of in-person work. Tenants are increasingly determined to live in buildings or areas with amenities like gyms, pools, and common working spaces that make remote work feel less isolated.

Have Any Questions?

If you currently own or want to purchase or lease commercial real estate, it’s essential to understand the current market trends. Please contact Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 if you have questions about the commercial real estate market in Longmont, CO, and our neighboring communities.

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Commercial vs. Residential Real Estate Investing

August 16, 2022

Commercial vs. Residential Real Estate

Some real estate professionals have strong opinions on whether it’s best to invest in commercial or residential real estate. The truth is that your financial position and your goals will determine which investment is best for you. In the end, each strategy has its own pros and cons.

Your residential real estate investment could be a single-family home, condo, townhome, and anything up to a quadruplex. Commercial real estate is anything that has 5+ dwelling units, office buildings, retail space, hotels, etc. To decide which path is right for you, let’s look at some of the benefits of the two types of real estate investment.

Pros of Commercial Investment

While it may be tougher to get started due to higher costs, there are some great benefits of commercial real estate.

  • Well-Qualified Tenants: In residential properties, you typically work with families or groups of people as tenants who may not treat the property as you would. In commercial real estate (aside from apartment buildings), your tenants are well-qualified businesses that likely won’t create as much wear and tear on the property. 
  • Lease Terms: In commercial real estate, five to ten-year leases are common, which means there is significantly less turnover than in residential leases. Additionally, triple net leases are often used, meaning the tenant handles all property expenses directly, significantly reducing the property owner’s maintenance costs.
  • Appreciation: In residential real estate, the value of a home is heavily dependent on comparable homes in the area. For commercial properties, the building’s value is almost purely based on its cashflow potential and thus can appreciate very well over time without being affected by the surrounding structures.
  • Return on Investment: The larger scale of commercial investment properties typically correlates to a greater return on investment. While it may require more cash to begin investing, the cash flows almost always beat residential properties. 

Pros of Residential Investment

There are also many pros to residential real estate that may make it a better fit for some. 

  • Large Tenant Pool: As opposed to working primarily with businesses, residential real estate has a large pool of tenants and buyers. A larger tenant pool ensures that vacancy rates stay low and cash flow is consistent. 
  • Starting Cost: Residential real estate is often much more affordable than commercial properties. The lower starting cost makes it easier for investors to start in the industry. 
  • Recessions: Businesses are always quickly impacted by an economic downturn which inevitably affects their landlord. Companies may go out of business or look to cut down on costs, and suddenly commercial properties are hard to market. Residential real estate, however, typically stands strong, no matter the state of the economy, as people always need a place to live. 
  • Fewer Rules: Commercial real estate comes with many zoning laws, regulations, and paperwork. Because residential real estate doesn’t involve renting to businesses and is typically smaller scale, there are significantly fewer rules to follow.

What is Best for You?

If you are curious about what investing strategy might be best for you, it’s important to connect with a real estate professional to discuss your options. Please contact Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 if you have questions about the commercial real estate market in Longmont, CO, and our neighboring communities.

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