MidWestOne outlines pros and cons of renting vs. buying commercial space
MidWestOne Bank VP says it's vital for business owners to consider both disadvantages and advantages of leasing versus buying commercial space.
In a recent blog post, MidWestOne Bank's Vice President of Commercial Banking Chase Stafford offered his advice to owners of growing businesses that need to expand their commercial space.
"The right choice ultimately depends on your current business and finances combined with where you want to take your company in the future," Stafford wrote. "To make your best decision, it’s helpful to consider the advantages and disadvantages each approach offers, and relate them to your business situation."
He said that some of the advantages of leasing a commercial space include no down payment requirement, no repair or maintenance costs, and easier qualifications than buying. He also laid out the disadvantages of leasing commercial space including annual rent increases, no equity and lack of control over property.
Stafford also delved into the advantages and disadvantages of buying and selling commercial space. Advantages Stafford listed for buying include no rent, tax deductions as well as investment and capital gains. He also said more responsibility and substantially more initial costs are among the disadvantages of buying commercial space.
By understanding and evaluating these advantages and disadvantages based on your specific business, owners can make a better choice.