This is where you should answer the most common questions prospective customers might have. It’s a good idea to cover things like your return policy, product warranty info, shipping and returns, etc. Check out the examples below.
Q&A On Owning a Commercial Condo
WHAT IS AN OFFICE CONDO?
An office condominium is a portion of an office building (referred to as a “Unit”) that can be purchased,
rather than leased, from the owner/developer of the office building (referred to as the “Sponsor”). The
owner of the office condominium unit (the “Unit Owner”) holds title to the premises and has full control
over any and all design elements within the premises. Office condominium units may also be purchased
from another Unit Owner. The condominium unit may be as small as a single office suite among many
suites on a floor of an office building, or it could consist of an entire floor of an office building, or even
several combined floors. Any construction or other improvements made to the premises of the office
condominium belong to the Unit Owner.
One of the best ways to get into commercial real estate is to buy property that your company can use.
One of those ways is to buy a commercial condo. The SBA may even be able to help too with a loan
guarantee that would allow you to only put 10% down. A great use of leverage.
“Many people understand what a residential condominium is because the concept has been around for
generations. In order to understand commercial condos (also called “non-residential” condos), we can
apply many of the residential guidelines, but with the added benefit of potentially increasing profits for
Following is a simple list of frequently-asked questions that will give you a quick and thorough
education about commercial condos.
As a business owner who currently leases my workspace, how would I benefit
from buying that space?
The most obvious benefit is that you’ll own the property rather than rent it, so over time it will gain
equity and become a valuable long-term asset. If you leased your 1000 square-foot work space for $30
per square foot for 10 years, you would spend $300,000 (excluding any annual increases) during that
time, but all that equity would go to your landlord instead of you. If you’d purchased the space, each
year you would be paying yourself and increasing your equity in the property. You could also have
multiple tax benefits that you’d not be able to take as a tenant, such as mortgage interest, property tax
deductions and deductions for repairs and depreciation. As an owner rather than a tenant, you’ll have
complete autonomy and freedom to create the exact space you need for your work. You can redesign
and remodel to your heart’s content.
What are some of the less obvious benefits?
If you’re moving into a new location, a lease option (leasing now with an option to buy later) can lock in
the purchase at today’s price. And if you purchase more space than you need, you can rent out the
remainder. Those rental units will pay for themselves while building equity for you.
How do I purchase a commercial condo?
Many business owners don’t realize that while commercial banks are hesitant to make loans, the Small
Business Administration (SBA) is actively offering up to 90% financing to established businesses for the
purchase of office, industrial and retail space. There are many financing options available, but the
financing can be complicated because the lender won’t necessarily understand what type of property it’s
dealing with. Is it residential? Commercial? Retail? What kind of loan is it? That’s why we suggest that
you work with a trusted banker or broker who can bring in a team of experts (accountants, lawyers,
architects, as needed) to help you find the best loan and
the best property.
Will I have to pay property taxes?
Yes, because you are the owner of a piece of property.
But like a home loan, the property taxes can be rolled
into your monthly loan payment.
Some residential condo complexes have
homeowners associations and dues to pay.
Is this true with commercial condos?
Yes, there will be an HOA (homeowners association), and there will be monthly dues. But these dues pay
for property maintenance, landscaping, insurance, professional management, and more. If you owned a
house, you would also be paying for these things. One advantage of an HOA is that it guarantees that
these maintenance issues will be addressed and that the property will be well cared for.
How are the common areas like parking lots, lobbies and walkways maintained?
Property maintenance will operate the same way it did when you were a renter. The developer, or
owner of the property, will turn the management responsibilities over to the HOA and the board of
directors (which is usually made up of individual owners like yourself). Usually a property management
firm will be hired and paid from the HOA funds.
What does the board of directors do, and how involved will I need to be?
The board makes day-to-day decisions about caring for the property. For example, the parking lot may
need to be re-paved, or the sprinkler system may need to be upgraded. The board prioritizes these
various needs, seeks bids from vendors and makes sure the work is completed. As an owner, you may
choose to serve on the board or not. It’s not required.”
With average sales price of office condos in Houston area starts at $140 SF to $200 SF, we can be
assured that we can feel good on net returns of your investment.
Here are some comparable for office condos in the Houston area: