Deciding on a property to buy or lease for your business can be tough. There are a lot of boxes to tick! This is why we’ve created a simple 8-step checklist to guide you through the kind of questions and essential items you should be checking before committing to new commercial or industrial business premises.
This checklist is not designed to be an all-encompassing list of what to look for when purchasing or leasing a property, as we know many clients have unique requirements! But this checklist should still serve as a useful (and bookmarkable) source of important items to follow as part of your due own diligence!
While it may not happen every day, we’ve seen sufficient instances of clients securing a property, only to find out later something does not meet their needs…
Sometimes this can be overcome without a great issue.
Sometimes it is a far more costly and involved process to overcome such obstacles.
And sometimes, it is simply not possible to find a solution, which can lead to the costly process of securing alternate premises.
While we try to be consistent in our discussions with clients to understand their needs in an effort to avoid any pitfalls, no-one should understand their specific needs better than the client! Therefore, before we even get into sharing our essential buying and leasing checklist, our first (and most important) tip is to make sure you hold a thorough understanding of what your business will need from commercial premises, especially around any technical, mechanical or logistical requirements. Answering that question will help you to navigate what your ‘must haves’ are – rather than just focusing on the ‘wants’ in your ideal property.
1. Disability Access
Are you required to provide this for either your staff or your clientele? While it is ideal to have disability access, if this is not a ‘must have’ for your business, you will find broader property opportunities open up to you. This may help you to secure a property that fits your other needs or budget more appropriately. If disability access to the property is a necessity, you should also check if the property has adequate disability-compliant toilet facilities and that you will be able to access and utilise these facilities if moving in.
Not all parking is made equal. While this one seems obvious, you should be mindful of how crucial parking is for your business needs. Some businesses require ‘secure access’ parking, while others may not require any. Be sure that in any of your buying or leasing negotiations you have clearly documented any parking inclusions or allocations. While it may seem over the top, you should consider things like:
- Whether the parking is exposed to the elements or is undercover
- Whether parking has secure access or not
- Whether you can rotate various vehicles in the same parking spaces (as some buildings will have a strict access control system that may identify unique vehicles, thereby not allowing you to rotate a limited number of spaces among a larger number of vehicles).
If you’re leasing premises, be sure to ask for specifics on the parking arrangements, including a plan of the allocated parking spaces. If you are purchasing a property, be sure to understand how the parking is included with the title to the property.
3. Vehicle Access
While it seems obvious to consider if your trucks or other vehicles will be able to access the building, you should also consider whether the road infrastructure accessing the property, and the driveways accessing the property, will also be suitable for your required vehicle movements. In some cases, a roadway may be too narrow, an overhead bridge may be too low, or a driveway may be too steep for longer wheelbase vehicles. Finding ways around these logistical obstacles may not come cheap, so it’s worth doing your research before committing!
4. Access Hours
Accessible hours may not be so much an issue for freestanding properties, though you should still ensure you consult with the local Council for any zoning restrictions that may affect your industry. Most often, restriction of trading hours can be an issue in strata title properties. You should check if the strata by-laws restrict any operating hours. If your business operates outside of standard hours, this is a particularly critical item to check, whether you are leasing or buying a property.
Does your business have specific power needs, such as 3-phase power, or a certain load requirement (such as a 300amp supply)? It can be a costly exercise to upgrade a building if you have overlooked this item when purchasing. While you should generally be able to upgrade to 3-phase power if the property only has single phase power connected, getting a higher load (say above 100amp supply), available at the property can be a lot more difficult and in some cases very costly, if it is possible at all.
6. Air Conditioning
Go one step beyond simply checking if the air conditioning works. If you are going to be responsible for the upkeep of the air conditioning system, make sure you understand what condition it is in before you take on the responsibility. Many commercial buildings will operate on a central system with a time clock, which may mean you have no air conditioning after the ‘set hours’. Sometimes there are options to work around this, such as having an ‘after hours’ switch installed, but this may come as an unexpected cost – and in some cases may not even be possible. If you need to supplement existing air conditioning, or install air conditioning where it may not exist, there could be obstacles that you need to face, such as approval from an owner’s corporation if you are in a strata plan.
In this modern age of technology, more and more businesses are reliant on the use of cloud-based services and a fast, reliable internet service. Not all areas provide the same quality in NBN and some regions still do not even offer NBN, which may make them completely unviable for certain industries. Various industries, particularly those who may rely on video conferencing, networking with overseas partners, or those dealing with large content files and like, have a heavy reliance on a fast, secure internet service. There may be good workarounds available today, but at what cost and at what effort to your business?
Does the property you’re considering afford your business room to grow without having to relocate again? Relocations can be costly in terms of the direct moving costs, but also the downtime and lost revenue it may trigger for your company. If the property you select affords you some flexibility for growth, while also meeting your budgetary needs, your future self may be very grateful for this foresight.
Additionally, there are normal checks to add to your list that most people are more familiar with, such as Pest and Building Inspections, or Strata reports (engage an independent audit of the books for the strata plan), so be sure not to miss those! But the above items are the most common things we notice are overlooked by clients browsing for business premises – this is exactly why we’re calling them to your attention.
Remember: ‘prevention is better than cure’ so make sure you do your thorough due diligence at the start of your property journey to properly protect yourself from common pitfalls.