Things to Consider Before Investing in Commercial Property

Things to Consider Before Investing in Commercial Property

By sanjit Posted 08-03-2024 Architecture

The real estate industry in Goa is thriving. People are increasingly investing in properties owing to the vibrant nightlife, favourable climate, lush greenery, serene beaches, and increasing urbanization. Goa is emerging as a hub for various commercial activities, like startup businesses, agriculture, tourism, and hospitality. Additionally, Goa's growing skilled workforce and government initiatives add to its appeal for commercial ventures. Recognizing this shift, investors are increasingly capitalizing on opportunities in sectors such as hospitality, retail, coworking spaces, and industrial properties, to name a few. However, for any commercial venture in real estate to be a success, there are a few key points to keep in mind. 

Looking to invest in Commercial Property?

A Suitable Location Is Imperative

When investing in a commercial property, selecting the right location is important. There are several factors to consider when choosing a feasible location. Begin by evaluating the accessibility of the property. This comprises checking the proximity to major transportation centers like highways, airports, and ports. 

Goa is currently revolutionizing the transportation sector with the construction of highways, new bridges like the Atal Setu and new Zuari bridges, and the newly constructed Mopa airport. In addition to this, make certain to assess the surrounding infrastructure. This includes the available utilities and nearby amenities such as restaurants, healthcare facilities, schools, and shopping centers. This approach helps better understand the property’s value as well as its attractiveness for business before making any investment. 

The Type of Property Matters

Outline the specific needs and preferences of your target market when considering the type of property you are looking to invest in. There are a range of commercial property types in Goa, such as industrial warehouses, retail spaces, hospitality establishments, office buildings, and so on. Each type of property offers different advantages, challenges, and characteristics. To attain a deeper understanding of this concept, observe that retail spaces require high foot traffic for them to successfully function. It is not uncommon to find commercial establishments in 4BHK Luxury Villas in Goa as well.

Tourist areas like Baga, Candolim, and Calangute in North Goa would be the ideal locations for such establishments to be successful. In fact, a few premium real estate developers in North Goa have already begun penetrating this lucrative market, providing ample opportunities. 

As an investor, carefully assess the rental yields and the demand-supply dynamics, along with calculating the potential for capital appreciation. Include an average of the maintenance costs and any construction and labour costs that may be required when evaluating the investment viability. 

Follow Market Trends Closely

It is a wise move to conduct thorough research and identify the opportunities and risks involved in the investment. Refer to online research and reports, community group pages, and real estate professionals for better insight into current and past market trends. Seek guidance from experienced real estate agents or consultants to gauge the market and obtain necessary information on the demand and supply of upcoming commercial projects. In tandem with this, follow the local news channels and newspapers, attend seminars and even consider legal advice before making any investment decisions. Furthermore, closely follow the demographic and economic trends of the area, including population growth and income levels. 

Outline a Budget

Meticulous evaluation and allocation of a budget help boost returns as well as mitigate any anticipated financial risks the real estate market may pose. To achieve this, establish a concise financial plan that seamlessly aligns with the proposed investment goals and risk tolerance. Determine the overall investment budget by including key costs like property acquisition, legal fees, and due diligence costs. 

Factor in ongoing expenses like insurance premiums, property taxes, maintenance costs, property management fees, and any potential renovation costs. Set aside an emergency fund and continually modify the overall spending plan based on changing market trends. In essence, the investment should generate a positive cash flow that meets the ROI (return on investment) objectives. Investors can optimize their investment strategy by considering alternative financing options through loans or by entering into a partnership.

Consideration of these aspects is imperative before investing in any commercial property in Goa. By collectively weighing these factors, investors can make better-informed decisions that meet specific objectives, mitigate potential risks, maximize returns, and, basically, lay a strong foundation for a sound investment strategy. You may also like to read our blog post on why real estate commissions are so high in India.

This site uses Akismet to reduce spam. Learn how your comment data is processed.