Let’s say you’ve found a handful of really hot prospective commercial properties, each of which would be ideal for your business – or so you think. One way to really hone in on the winners is to quickly eliminate the losers, something you can do with a comparative analysis. Using an electronic spreadsheet, you can set up a thorough and systematic analysis that puts all the comparable features side-by-side.
What to Compare
Set up a table with the property locations as each column header across the top of the table, and various detail down the side as the row entries. Details you’ll want to compare include:
- Leased square footage
- Unit lease price
- Years required in lease term
- Type of lease required, whether gross, net or modified gross
- Maintenance and other incremental expenses that are included or not
- Top benefits of the property
- Any drawbacks of the property
The benefits and drawbacks notes can especially come in handy if you’re down to the final few and need a little extra push in one direction or the other.
Leased spaces can be significantly different in size and price, but the unit least price will help you transform the cost into an amount that can be accurately compared across the board. The unit lease price refers to the price per square foot of the space per year, and you can use it to estimate the monthly base rent for each space you’re considering.
First multiply the unit base price by the total square footage of each space, which will give you an estimate on the annual cost. Then divide the annual cost by 12 to get an estimate on the monthly rent for each space.
Getting an estimate for the monthly rent can help you determine if certain spaces are indeed worth the money – or if you’d be better off with a larger space for the same price, or perhaps a smaller space that was more aligned with your ideal location and business needs.
Seeing all the facts laid out in front of you can make it much easier to take the emotion out of the equation and choose an ideal space based largely logic, intelligence and what will benefit you best in the long run.