To Buy, or To Build, that is the Question!
So, your business is growing and you’re in need of a new space. Congratulations! This is a very exciting time, but it also comes with many decisions. Among these decisions is deciding to either build a new commercial space for your business or to buy and potentially remodel an existing space. There really is no wrong or right answer in and of itself, but there are a few significant details to consider when weighing your options. In this piece, we’re going to discuss some aspects of commercial construction as well as existing business modeling that you may not have considered.
1) Make sure your business’ needs will be met.
Before you decide to pull the trigger on remodeling an existing business space or building a new location from the ground up, think about the requirements of your day-to-day operations. What do you need? If you’re a retail store, will you need easy access to a loading dock to bring in new inventory? Will you require foot traffic beyond what you may offer online to truly thrive as in districts such as our Noth and South business districts on Main Street in Princeton, or perhaps along with the riverfront areas of Dixon, Sterling or Rock Falls?
If you’re a restaurant, what kind of kitchen space will you need? How much dining space? Will there be a bar? Moreover, does the total square footage of the proposed dining space even meet the minimum required per the code of the particular jurisdiction in which you wish to operate. And lastly, albeit probably most importantly in today's world; will you need a location suitable for drive-thru pick-ups or even proximity parking dedicated for carry-out customers? Even if you don’t decide to build, get an idea of precisely what you need so when it does comes time to remodel an existing commercial space, you can transform it to meet the demands of your business rapidly.
Questions like these are perfect examples of why you should establish a relationship with a design-build firm such as ARK Building Solutions as early in the process as possible. At ARK Building Solutions we offer a unique, low-commitment, and low-cost but undeniably invaluable service that can thoroughly answer many of these questions for you so that you can make me the most well-informed decision possible for your business and your future. Our branded version of the design-build delivery method employs multiple generations of experience and knowledge, along with an unwavering dedication to value engineering can help you truly understand what the various options you have and how those options will affect not just your initial investment but your potential revenue earnings and opportunities for future growth and expansion. Our intimate understanding of local real estate availability and code requirements coupled with our ability to quickly provide spatial relationship and programmatic analysis studies of various spaces can help you truly comprehend the depth of your build v. buy dilemma.
2) Weigh the costs of doing remodeling versus building.
Whether you’re buying or remodeling, either option will incur unique costs associated with your decision. When buying, you’ll need to factor in the costs of an appraisal of the space, the cost of the building itself, and what parts of the building may need extensive remodeling beyond just what customers will be able to see. Older buildings may have more character and be in more desirable locations, depending on your business, but the upkeep of such structures is not without its own cost, one that will continue to for years to come. On the other hand, when building from scratch, there are a whole set of different costs one must consider. Are you going to need to demolish any existing structures in order to build? How much will it cost to build in access to necessary utilities like power, water, and sewage? Without the assistance of a design-build team such as the one that forms the backbone of ARK Building Solutions many owners might not factor in some of those costs that, while not necessarily as important or visible to you, your intended customer, or overall business model they are, nevertheless just as important and without a doubt still necessary. As you can see from the illustration below the total cost of a similar project between renovating an existing building and building a new structure is fairly close. However, building a new home for your business will buy you significantly more time and use out of it; that is if you can find the space to build it in a desirable location.
3) Determine if building or remodeling makes more sense in your location.
The latter of those words, especially in the realm of commercial construction is unmistakably one of the most important factors in the ultimate success or lack thereof of whatever venture you so chose to pursue; LOCATION, LOCATION, LOCATION. Would you like to be located in a posh shopping district or would your business be better served and ultimately more profitable if it were near large-scale commercial services that perhaps might lie beyond the beaten path? Your ideal location may help you decide whether building or buying is in the cards for your business. New builds may be more of a headache in historic districts.
However, remodeling may not be an option if a suitable space does not exist where you would like to be. Think about where you’d like to do the most business and go from there. Better yet, think about where your ideal clients would prefer to do business and start there first. Grab a map, start circling the areas that your ideal customers might readily frequent, and then circle the areas that you yourself would like to operate from. Where these areas overlap is a great place to start! Now understandably that is quite an oversimplified means to an end which is even more so made challenging by the rural area in which we live but it is no less a great place to start. Again though, this is why it is pertinent to involve a firm such as Ark Building Solutions early on in the process. Rely on their expertise and that of the clients they have previously served for any respectable contractor will have surely explored similar dilemmas in the past with other businesses from which you can benefit from their experiences having faced the same decision themselves. What worked? What didn't work so well? We are more than happy at ARK Building Solutions to not only share our successes but also those times where success was not so readily achieved for it is from those experiences that we have learned and grown the most from and which will provide the greatest insights for your own venture.
4) Consider your future. Will you need to expand again?
If already an established enterprise you’re probably considering a move now because you either need the extra space, are wishing to expand into new markets, or you have reached that critical moment where one must decide whether to continue to invest in an existing location that may not quite suit your current needs or to pack up and move to greener pastures, regardless of whether that means building new or perhaps again, renovating another existing location. What if that happens again? Are you prepared to continually return to this same dilemma or do you have the foresight to realize your potential and embrace the opportunities it poses to it fullest extent? Perhaps you may have decided to either over-build or conversely, and as could be easily possible with such limited inventory purchase an existing property beyond what would be needed for your business to operate thus allowing you the flexibility to generate further income by renting out unused space to other businesses? Not only does this provide for an alternate, secondary income but it also gives you the flexibility to expand much more easily in the future without having to return to square one. Especially when there are opportunities for you to grow your business it is imperative you do so as quickly and as seamlessly as possible to eliminate any lost revenue from downtime. This yet again is another perfect example of why contacting a professional early on in the process can make or break the success of your planned endeavor.
5) With so many things to consider there's at least one thing you won't have to worry about; Who will help you grow your business?
Whether you’re looking to buy and remodel an existing space for your business or maybe it’s time to start from scratch by building a new commercial property design specifically to suit your every need, ARK Building Solutions can help you with every aspect of the project, from concept to completion. Our dedicated and customer-focused team can make your entrepreneurial dreams a reality. Reach out to see how we can help your business thrive with experienced commercial construction services.