Answer These 3 Financial Questions Before Building
For many growing companies, their space needs to expand. Whether it’s a manufacturing facility or sales office and headquarters location most of these businesses outgrow one or more existing facilities within the organization.
But regardless of how big or small your company is, there are 3 important financial questions you need to answer before embarking on a commercial building project.
Can we expand on current site or do we need to relocate to another site?
The decision to expand your company’s facilities or relocate needs careful consideration.
Determining whether you will need more land at this location and if renovation is possible before construction can begin are just two considerations in what may be a long-term project for some business owners.
In addition, when leasing multiple properties that exceed their capacity (or have outlived themselves), constructing another site could prove financially sound moving forward as well.
How will we fund the construction project?
The next important financial question to answer is how will the construction project be funded? There are a variety of options for funding a commercial building, such as cash or short-term loans.
The amount you have in hand and your borrowing capacity ultimately determine which option is most viable at any given time; however, it can also depend on whether interest rates are low enough that they make sense compared with other factors like timing restrictions when deciding between different types of financing.
You’ll want to consider the different tax treatments that may apply if you’re relocating from a leased facility and building your own commercial space.
There could be other incentives like economic development, especially where it’s in an eligible zone for those types of programs.
How long can we expect this building project to meet our needs?
As companies grow, they need more space to store their belongings.
Many buildings that were originally designed for short-term use may not be able to keep up with the needs of an expanding company.
When planning a building construction project, you may want to consider accelerating growth in your company for the next 5-10 years and then managing future needs.
This will help avoid any potential problems caused by running out or not being able to meet those demands as they arise which could lead all sorts of unexpected issues down the road.
As you’re seeking the answers to these financial questions, it is a good idea to speak with an experienced commercial building contractor.
They will be able to provide cost estimates along with delivery and financial options that can help get your project off of ground.
At JeBailey & Co., we manage commercial and industrial projects in a wide range of markets. We specialize in construction management services, so you can trust us to deliver the best results possible for your project.
Contact JeBailey & Co. today at (407) 559-6412, or email us at info@jebaileyandco.com to learn more about our other services or request a quote!
