The concept of commercial condominiums has taken off over the last several years. A commercial condominium is similar to a residential condominium in that there are commonly shared elements that go with ownership. There are many advantages in owning a commercial condo over owning a stand alone building.
Sharing the burden of major costs is a big advantage in owning a commercial condo over owning an entire building. Commercial condo owners pay monthly association dues which feed a reserve fund for future building maintenance. It can be difficult for small businesses to save money for making large building repairs. One leaky roof or major plumbing issue could easily take a small business down. However, sharing that cost with other businesses ahead of time can help avoid a financial disaster.
Commercial condos are far less expensive to purchase than stand alone buildings because there is a common ownership of the land. Many small industrial businesses can operate in a space as small as 1,000 to 1,500sq.ft., but it is not cost effective to purchase industrially zoned land to only build a 1,500sq.ft. building. For this reason commercial condominiums fill a unique niche in the commercial real estate marketplace.
Often small businesses can begin by leasing a commercial condominium before they make a purchase. In example, a commercial condo can currently be leased in Bellingham, WA for only $0.50/sq.ft. Therefore that same 1,500sq.ft. building would only cost $750/mo. to lease. Leasing is often the best option for new businesses.
Another advantage to purchasing or leasing a commercial condo is that there is room to expand. It is typical for commercial condos to have a fair amount of turnover and often small businesses can take over adjacent units as they become available if there is a need for more space. In some cases the walls can be taken down. In other cases, doorways can be created to utilize both spaces.
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