Lease or Buy? Your Business Property Decision In Adelaide Lease or Buy- Your Business Property Decision In A | Page 8

The tightening of the eastern seaboard markets is forcing groups to seek out
alternative, higher-yielding assets in alternate locations and Adelaide is
benefiting from this, although stock supply remains low. To give you an idea of
the demand, our office is currently trying to place in excess of $500m into
Adelaide industrial assets from interstate groups. Plenty of good reasons to be
excited about the year ahead!
Market Predictions
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IV.
Prime rents: Increase
Prime improved values: Increase
Prime vacant land values: Increase
Prime yields: Tighten
Lease vs. Buy: Choosing a Commercial Real Estate Strategy
One of the classic questions in commercial real estate is whether it's best to
lease or buy space. Every time the question gets asked, the answer is always the
same: it depends. Here are four ways to dig deeper and find out which strategy
is right for your business.
 Cost
Up front, the rule of thumb it is usually less expensive to lease commercial real
estate than to buy it. Security deposits are usually less expensive than down
payments and loan fees. However, in certain instances, this rule won't hold true.
For instance, if you need extensive tenant improvements and can build them
into your loan when you purchase, you could end up spending less up front to
buy. Creative financing with little or no down payment can also help to lower
the initial cost of buying.
The prevalence of lease structures that tie rental costs to operating costs has
removed some of the safety from leasing. When you have to pay the same
expenses as a tenant that you would as an owner, you're taking the same risks
of having to pay for repairs or of having energy costs spike. Over the very long
term, owning can also turn out to be less expensive. While lease payments