What Should Ontario Businesses Look for in Commercial Property?

One of the most important decisions that one can make as a business owner is choosing the right commercial property. The commercial property you choose for your business is tied directly to general safety, accessibility, ease of logistics, insurance premium amounts, and so much more. 

At KASE Insurance, we are passionate about helping businesses succeed. In line with this, we’ve put together this guide on what you should look for when choosing commercial property in Ontario. Whether you are looking for a rentable commercial space or are interested in buying commercial property for your business, this guide will tell you all you need to know.  

Let’s begin! 

A. Compatibility with Budget or Availability of Financing Options

Whether you are going to buy or rent commercial property, the first step is to identify your budget. Furthermore, if you will be taking out a mortgage, it is important to understand that the maximum loan-to-value ratios can differ. In fact, commercial property mortgages are known to vary greatly depending on the lender that you opt for. 

In order to make sure that you get the best rates, it is recommended to enlist the services of a mortgage broker once you’ve already shortlisted properties that you are interested in. A mortgage broker will be able to connect you to lenders for industrial, office, retail, and rental apartment properties. 

B. Location, Location, Location 

Once you already have an idea of how much you are willing to invest or spend on your commercial property, it’s time to zero in on your options. The first aspect to decide on is the location of your commercial property. 

Here are vital factors to consider: 

• • Where Is Your Target Market?

Top of mind, it may seem that the brand’s connection to the location is only important for businesses like stores, restaurants, cafés, salons, and the like. However, location is important for virtually all businesses. After all, one of the first things that new customers or partners will see, upon discovering your business, is its location — and the site can speak volumes. 

When your brand and the location don’t complement each other, you may also have a harder time attracting customers. For example, if you operate a high-end fashion boutique, it might not be a good idea to choose a location in a college town since the price of your products won’t be within a student's budget. 

• • High Demand, Low Competition

The cruciality of this factor depends on the nature of your business. On the one hand, this would matter a lot for stores, restaurants, residential rental properties, rental warehouses, etc. 

For stores and restaurants, high demand and low competition guarantee good business. As for any type of rental property, this enables the owner to negotiate better rates.  

However, “high demand and low competition” may not be as important for offices, industrial spaces, or other types of commercial property that do not serve as customer-facing locations. 

• • The Proximity of Suppliers and Customers

The proximity of relevant stakeholders is important for any business. When suppliers are nearby, this means that logistics is a breeze. When target customers are close, this puts your business in the best position to be considered and preferred. 

• • Parking Options

For virtually all kinds of commercial properties, having adequate parking space is essential. The needs will differ depending on whether it’s a storefront, restaurant, warehouse, factory, or office space. Therefore, before choosing a commercial property, assess your business’s parking needs. If appropriate, also consider other off-site parking options available in the vicinity.

• • Crime Rates and Environmental Issues

This is important for all types of commercial property. If a location has high crime rates and frequent environmental issues (e.g. earthquakes, hurricanes, landslides), it’s a safety concern for all the stakeholders of your business. It’s important to note that high crime rates and frequent environmental issues will affect your commercial property insurance premium. 

C. The Overall Layout of the Commercial Property

Whether you lease or purchase a commercial space, you may need to alter its layout to best suit your needs. It is advisable to look for a space that is already close to your desired layout, so that you don’t have to spend too much on renovations. 

However, if you are willing to do extensive renovation work, make sure to consult a renovation contractor so that you are fully aware of the cost range. 

D. Reasonable Terms in the Lease Contract 

This factor applies if you are looking to rent a commercial property. As the years go by, your business may outgrow the area, and you might consider moving to a new location. However, most lease contracts have a lock-in period. 

If you move before the lock-in period is over, you will be obliged to pay rent until it expires. Therefore, consider the lock-in period carefully and see if it is compatible with your goals.

E. Good Condition and Age 

Lastly, look for a commercial property that is in good condition and with a reasonable age. For this, you can hire a professional to assess the place before you finalize the deal. Typically, the older the property, the sooner you’ll need to shell out on maintenance. 

Furthermore, the older the structure is, the higher your premium will be when you get commercial property insurance. The effect of age on the property’s insurance premium applies whether your business is buying or renting the space.   

Customized Commercial Property Insurance to Protect Your Business 

Whether you are buying a commercial property or you’re about to start renting one for your business, commercial property insurance is a must-have. This type of insurance does not only protect your space and the possessions therein, but it also reimburses lost income in case your business is halted due to property damage or inaccessibility. 

Our experienced team here at KASE Insurance will be able to put together a commercial property insurance plan that’s tailor-fit for your business. From negotiating premiums to following up on claims, we’re with you every step of the way for all your insurance needs. 

Contact our team today! You can also get started with a FREE quote.