Investing in Commercial Properties

Written on 9:04 AM by Yuen Lung

 

Today I attended a talked in iProperty.com Expo. The topic was "Retail & Commercial Developments Trends in the Klang Valley".

The speaker shared about the trends and how it impact real estate investment (for commercial properties). Some points which I think worth note it down and share with peoples.

Trends in Retail Market

  • Consumers will spend the same amount of money on necessities but they may cut down the number of shopping trips due to rising of petrol price.
  • There is strong demand for services among consumer as compare to necessity goods
  • Consumers prefer ONE stop shopping centre, bigger shopping centre so that they can get everything in one place and spend the whole day with family in the same place.
  • To survive retailers may:
    • Pass  part of the rising cost to the consumers
    • Cut operation cost such as electricity to save profit
  • National chain retailers will continue expand for growth

Issues/tasks

Check out the following List before Investing in Commercial Properties
  • Population size, profile and purchasing power of the area
  • Existing competition
  • Rental rates of the area
  • Existing retail activities
  • Current occupancy
  • Developer's track record
  • Developer's commitment to make it a success
  • Project with similar concepts

Pay attention to the following

  • Completion period (for new units)
  • Value of dual frontage
  • Value of wide frontage
  • Immediate frontage
  • Location of car park
  • Service charges for maintenance

 

In my opinion the most important point that mentioned by the speaker are: "Retailers will always looks for crowd and low rental price will not impact retailers' decision much in commercial unit".

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1 Comment

  1. Unknown | October 1, 2009 at 12:09 AM

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