Lease or Buy? Your Business Property Decision In Adelaide Lease or Buy- Your Business Property Decision In A | Page 9

typically escalate with interest, loan payments are fixed for as long as you have
your loan at a fixed interest rate. With self-liquidating debt, you could even end
up owning the property free and clear.
 Flexibility
Owning and renting commercial real estate Adelaide offer different types of
flexibility. If you own a building and don't have onerous prepayment penalties
in your loan, you can sell it whenever you want, although you could end up
losing money on it depending on your timing. On the other hand, if you rent,
you are usually locked in during your lease term, but can move out at essentially
no cost to your landlord whenever the lease expires.
The flexibility of leasing makes it especially suitable when you aren't sure about
a space's long-term prospects. On the other hand, if you have the opportunity
to take down a commercial real estate Adelaide property that you plan to
occupy for decades to come, buying could end up being the least expensive
option.
 Income Statement vs. Balance Sheet
Leasing and buying commercial real estate Adelaide are fundamentally
different from an accounting perspective. Under the accounting standards in
place as of 2014, leased property usually don't exist on your balance sheet. All
that you will do is record the expense of your operating leases on your income
statement. On the other hand, when you own a building, you report it as an asset
and depreciate it while reporting the mortgage as a liability. Many companies
choose to lease simply to keep their real estate obligations and the concomitant
debts off of their financial reports.
Deciding whether to lease or buy might seem complicated, but, in a way, your
business has already made the decision for you. It isn't about making the best
real estate decision. Ultimately, it's about making the best business decision.
The commercial real estate strategy that generates the best business results is
the right one.
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Steps to a Hot Commercial Real Estate Deal Adelaide