As a business owner, you’re constantly seeking paths to enhance stability and growth. Transitioning from leasing to owning your commercial space could be your strategic game-changer. This article highlights five compelling benefits of property ownership and navigates through federal loan programs, aiding a seamless shift. Ready to uncover if this pivotal move aligns with your business vision?
Five Benefits of Buying Your Building:
- Tax Advantages of Owning: Maximize tax savings by deducting interest and depreciation on your commercial property. For instance, with $3,000 monthly interest on your mortgage, you could deduct $36,000 annually, potentially offsetting taxes on $100,000 in profits. Note: Consult a tax expert for tailored guidance.
- Rental Income Potential: Transform your property into an income source by renting out parts of it. A small distribution business in Round Rock, Texas, enhanced its profitability by renting out a section of their building, boosting their cash flow significantly.
- Stable Monthly Payments: Say goodbye to unpredictable lease hikes. Mortgage payments often match or fall below rental fees. A roofing company in Austin exemplifies this, securing a larger facility with lower annual payments compared to their previous lease, fostering business growth.
- FlexSpace Customization Freedom: Own your space, own the rules. Customize your facility to align with your business needs, free from landlord constraints. A machine shop in Cedar Park, Texas, is a testament to this, enhancing security and client engagement by owning their premises.
- Retirement Stability: Invest in your post-career life by retaining your property for rental income post-business sale. A marketing studio in Leander, Texas, became a retirement income source for parents who purchased it to support their children’s venture.
Financing Avenues:
Engage with your local Community Bank for purchasing your space, fostering a beneficial long-term business relationship.
Federal Loan Programs – Your Gateway to Ownership:
- 7(a) Program: Offers variable or fixed rates, with down payments typically between 20-30%, catering to early-stage businesses or unique facility needs.
- 504 Program: Features fixed rates and a modest 10% down payment requirement, ideal for established businesses aiming for specific project goals.
Top 3 Reasons for Small Businesses to Invest in a WorkspaceUSA Property:
- Build Equity and Wealth: Each payment fortifies your financial foundation, enhancing borrowing capacity and securing resources for your golden years.
- Cost Predictability: Owning your property ensures stable mortgage payments, shielding you from leasing uncertainties and potential property sales.
- Cash Flow Preservation: Utilize low down-payment options to finance up to 90% of your property’s cost, freeing up capital for essential business initiatives.
Expert Perspectives:
- Chris Hurn, CEO of Fountainhead Commercial Capital, champions SBA 504 loans, highlighting the affordability of property ownership and its role in wealth accumulation.
- Kevin Partington, Executive Director at Cushman and Wakefield, advises businesses to weigh the long-term outcomes of leasing versus buying, considering the future utility of the owned property.