Owner Occupied Properties: The Real Benefits
From multifamily rentals to professional office space, commercial real estate investors are starting to shift to owner occupied properties for the many advantages they offer. However, not many people know what makes owner occupied properties so advantageous, or that there are special financing programs available when banks are not in the picture.
Maintenance And Management Costs
With owner occupied properties, there is no need to hire a property management company. This can save up to 10 percent on gross rents, thereby increasing revenue. Additionally, if the owner has the ability to take care of on-site maintenance, even more money is saved which would otherwise go to a third party cleaning service or paying to have a maintenance person on call.
Owner Occupied Properties Have Better Tenants
One of the major advantages of owner occupied properties is that they are a draw for better tenants. Many times, potential renters are driven away from properties with a “hands off” approach, and who are more focused on the bottom line than the quality of the occupants themselves. Owner occupied properties allows commercial real estate investors to be more selective about who gets to rent out space, and for how much. Also, knowing that the property owner is available on the premises usually attracts better residential tenants, and more professional ones for office space.
Ownership Expenses And Tax Benefits
Owner occupied properties – as with all real estate – will need maintenance at some point or another. Anything as small as changing lightbulbs on up to major renovations and upgrades. Because these costs come out of the owner’s pocket, rather than the tenants, they fall under ownership and operational costs. To that end, money spent on maintaining owner occupied properties can be used as itemized deductions when filing taxes, resulting in potentially big savings every year for commercial real estate investors. Additionally, owner occupants can claim depreciation of the property over time, adding hundreds and even thousands of dollars in savings when tax season rolls around.
Financing For Owner Occupied CRE
There are a number of financing options available to commercial real estate investors looking to acquire owner occupied properties. SBA loans, mezzanine financing, HUD and FHA loans, and many others can be used to acquire or build owner occupied properties. At CounselPro Lending, we have the ability to fast track SBA and other loan requests, to get you the financing you need to for property of any size. Call our offices at 1-888-292-3322 to get a no-obligation assessment to find out which financing program is right for your next commercial real estate project.