Benefits of Leasing
Land
Leasing land allows you to shape your property to your renters’ needs. This type of commercial investment typically requires less upfront capital, so you won’t have to worry about raising funds for a large down payment. You’re also less exposed to financial risks due to property depreciation and unexpected maintenance costs.
Flexible
Cash Flow
You don’t have to worry about your funds being tied up in your initial purchase when you lease commercial land. That allows more liquidity, helping you respond and adapt to changing financial needs, daily operations and growth opportunities. That’s crucial if your industry experiences market fluctuations regularly, so you can scale or downsize as necessary. You’ll have easier access to your funds to upgrade your facility, invest in technology and hire staff.
Flexible
Cash Flow
Flexible
Cash Flow
You don’t have to worry about your funds being tied up in your initial purchase when you lease commercial land. That allows more liquidity, helping you respond and adapt to changing financial needs, daily operations and growth opportunities. That’s crucial if your industry experiences market fluctuations regularly, so you can scale or downsize as necessary. You’ll have easier access to your funds to upgrade your facility, invest in technology and hire staff.
Prime Locations
Establish your business in a high-demand, high-traffic area without paying the premium of owning the property. Commercial land is a blank canvas where you can establish a foothold near retail corridors, industrial hubs and warehouse districts. Having access to your target consumers can give you a competitive edge over your competition. You can lease land and build your operations to suit your needs in an ideal environment to help your business thrive.
Prime Locations
Prime Locations
Establish your business in a high-demand, high-traffic area without paying the premium of owning the property. Commercial land is a blank canvas where you can establish a foothold near retail corridors, industrial hubs and warehouse districts. Having access to your target consumers can give you a competitive edge over your competition. You can lease land and build your operations to suit your needs in an ideal environment to help your business thrive.
Tax Benefits
You can deduct lease payments from your business expenses, reducing your taxable income. That can provide financial relief by offsetting your costs against your earnings and lowering your tax burden. Leasing commercial land also allows you to allocate more resources toward business growth and simplifies tax reporting. You can minimize your liabilities and avoid the complex filing process of owning commercial property.
Tax Benefits
Tax Benefits
You can deduct lease payments from your business expenses, reducing your taxable income. That can provide financial relief by offsetting your costs against your earnings and lowering your tax burden. Leasing commercial land also allows you to allocate more resources toward business growth and simplifies tax reporting. You can minimize your liabilities and avoid the complex filing process of owning commercial property.
Is Leasing Land
a Good Investment?
Leasing commercial land is an effective way to generate passive revenue, especially in markets with increased urban expansion. You can enjoy financial flexibility, allowing you to invest in your operations and expansion. The liquidity provided by leasing is also crucial for maintaining financial stability, especially if you own a startup or small business. You may wish to lease commercial land if you plan to expand, so you can grow your operations in response to market changes. A lease also gives you more mobility as you can end your contract if the land no longer suits your needs.
Frequently Asked
Questions
Whether you’re looking for a quick answer for more extensive insight, we have answers to common questions about commercial real estate brokerage services.
What types of properties are considered industrial spaces?
You’ll need to account for zoning regulations, accessibility, infrastructure and potential developments. It’s important to carefully evaluate your lease terms, including guidelines on contract duration, renewals and property modifications. DRK’s expert commercial real estate team can help you review and address issues that may arise when leasing land.
How can I generate income from undeveloped land?
You can lease your commercial land for temporary use such as storage, signage and parking lots. Leasing to other developers is another way to generate revenue from unused land.
What are the risks associated with leasing commercial land?
You can’t build equity when leasing land, so you can’t benefit from the asset’s appreciation over time. Some contracts may include periodic rent increases, too, increasing your operating costs. You may also be subject to maintenance responsibilities and early lease termination depending on the property owner and market changes.
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