Buying Vs. Leasing

When your company decides it’s time to search for commercial space, it can sometimes be difficult to decide between buying vs. leasing. On the one hand, buying gives you the opportunity to invest for the future, while leasing tends to offer more flexibility. So what’s best for your business? This guide covers some benefits of both options– so you can decide on the most strategic route for your long- and short-term goals.

Benefits to Buying a Commercial Property
  • Long-term stability: Buying provides stability and long-term security for businesses, as they own the property and do not have to worry about rent increases or losing their space to a landlord’s sale or redevelopment.
  • Potential for appreciation: If the value of the property increases over time, the business can benefit from the appreciation and sell the property for a profit.
  • Customization: Buying provides the opportunity to customize the space to the specific needs of the business, which can increase productivity and efficiency.
  • Tax benefits: Owners of commercial properties may be eligible for various tax benefits, such as depreciation deductions and reduced property taxes.
Benefits to Leasing a Commercial Property
  • Flexibility: Leasing provides the flexibility to move to a different location or upgrade to a larger space as the business grows without being tied down to a long-term investment.
  • Lower upfront costs: Leasing typically requires a lower initial investment compared to buying, as tenants only need to pay a security deposit and the first month’s rent.
  • No maintenance costs: Leasing typically means the landlord is responsible for maintenance and repair costs, which can be a significant advantage for businesses that lack the resources to handle such costs.
  • Tax benefits: Leased space may be tax-deductible as a business expense, which can provide significant tax benefits for companies.

The choice between leasing and buying will depend on the specific needs and goals of the business, and a professional real estate advisor can help determine which option is best for each unique situation.

 

Tim Tysk

Director

ttysk@carlsonpartnersllc.com

(651) 470-5231

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