Owning your own business and your own property

Owning your own Business and your own Property.

Companies have proven that owning commercial property held by their own companies provides them the advantages of stable rents for their businesses and appreciation for themselves.

According to Standard Bank, it experienced 44% year on year growth in owner-occupied commercial property deals for the period 2012/ 2013. One of the primary reasons for this is that more businesses have been looking to purchase buildings for their own use rather than opting to rent their business premises.

Owen du Plessis of Team Cape Commercial associated to CCH Commercial says the main reason for the increased owner-occupied commercial property deals is that businesses are seeking to shield themselves against annual rental increases, which typically escalate at 8% per annum on average.

The biggest advantage according to Owen du Plessis from Cape Commercial CCH associated to CCH Commercial is that you are not at the mercy of a landlord’s annual rental increases and hedges the leverage used by landlords in negotiating a far higher rent when the lease expires. That is especially relevant for companies that have built up a considerable amount of goodwill with their clients due to the location of their premises.

Commercial property loans are typically granted over periods of 10 years with buyers usually financing between 70% and 75% of the property’s value. 

While the majority of owner-occupied commercial property transactions are from businesses looking to purchase an existing building, some companies are looking to add specifically designed properties to suit their developing businesses. 

When a business looks to build its own premises it is usually a vote of confidence in their long-term future. This is a crucial aspect in the way Financial Institutions look at your Business in further gearing or lending applications. 

To have a look at available properties for your business, please contact Team Cape Commercial’s Owen du Plessis on 021 824 7744 or at owen@cch.co.za .