Due to the profits it generates in the future, real estate investment has remained one of the most convenient options to build wealth and bet on an investment that generates long-term results.
Within this broad sector, commercial land has captured the attention of those planning to build a business that generates consistent income; who also want to build a solid economic base that provides stability when it comes time to retire.
However, the success of a business does not lie only in offering a service or product with high demand; it is also important to have a space that meets specific characteristics for its construction.
In this article, we will talk about what commercial land is, what its characteristics are and the reasons to invest in one.
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What is Commercial Land?
The commercial lands are extensions of land located in strategic areas, with constant economic development that ensures a suitable investment for the opening of businesses.
Commercial land is based on the type of use specified for this purpose. Regardless of the line of business you have in mind, there are certain characteristics that land of this type must meet in order to build a business.
The main thing that is analyzed when choosing one is that it really has growth possibilities and is positioned in a solid way within the commercial area of the area.
The commercial zones have their origin in need to generate jobs and boost trade. The most common example of a commercial area is the small squares that bring together different types of businesses, from restaurants to laundries, stationery stores and convenience stores.
The benefits of acquiring land in a commercial area are varied and represent a safe opportunity for both entrepreneurs and investors to start a business.
Commercial Land to Build a Business
Now that you know what commercial land is, depending on your project, it will be the extension and characteristics that it must have.
For example, macro lots have very large tracts of land and are ideal for large-scale projects such as an industrial park, unlike lots that are intended for small projects.
The idea of building a business can be very convenient in the short or medium term, as long as you opt for a line of business that has the potential to grow and the land where this project will be carried out is chosen correctly.
However, like any investment, acquiring commercial land involves a certain level of risk; For this reason, since it is a good in which an important part of the capital will be allocated, it is advisable to approach an expert in the matter.
Among the risk factors that must be taken into account, there are three levels, of which investing in real estate has a medium risk level; when investing a greater part of the capital, a more detailed analysis of the situation is required.
Therefore, having a real estate advisor when investing in a piece of land, who can guide you appropriately to reduce any risk, taking into consideration your interests and type of project, will be a key piece for the success of your operation.
There are companies with experience in the real estate sector —such as Sky Marketing—, which focus on offering strategically planned commercial land projects in urbanized areas, such as Lahore Smart city Commerical , and with accelerated growth that guarantees a profitable investment.
In our article advantages of investing in urbanized land, we talk in more detail about the benefits that are acquired by buying with a company, which facilitates the procedures and delivery of properties according to the terms and conditions established for commercial premises.
Key Points to Investing in a Commercial Land
Investing in real estate is one of the best options that exist to use your retirement savings and earn profits safely.
As we mentioned, to make this type of investment, it is necessary to have sufficient knowledge or hire professional advice.
Among the main points that it is necessary to know to make a successful investment are:
1. Strategic Location
One of the factors that most influence the behavior of a business is, precisely, the place where it is located. When we speak of a strategic location, we refer to a series of aspects that —when combined— are ideal for starting a business:
- Close to residential areas. Commercial land near subdivisions is an excellent investment opportunity for businesses that offer products or services that meet the needs of residents and facilitate their day-to-day life, such as stationery stores, dry cleaners, stores or laundries
- Easy access. The land must have nearby main avenues, enabled access roads and transport routes that facilitate the arrival of the client
- Close to an active zone. Frequent places such as schools, gyms or shopping centers will increase the flow of customers
- Close to suppliers. Without being a determining factor, it is important to consider it when investing in commercial land, since it implies saving time and money in the long term
Having an Excellent Location is the First Step to Guarantee the Success of Any Business
Among the options that exist to make money with land, location plays an important role, even if you will not use the land to start your own business but will rent it to franchises. For example, what these companies are looking for is to put their premises in places with high traffic of people.
If you want to know more ideas to earn money with land, we invite you to read the article we have on this subject.
2. Commercial Land Use
Today it is possible to find a wide range of investment land for sale. However, not all of them are registered with the corresponding permit for commercial purposes.
Having this authorization is essential to start the construction and operation of a business without setbacks. Any company that sells land must take this into account and have up-to-date requirements.
From a commercial lot to commercial plazas, all properties that wish to be established for commerce require having the type of commercial land use.
Depending on the activity to be carried out in the business, there are different classifications for the use of commercial land:
- Specific land use: as its name indicates, this permit is limited since an activity other than the one specified from the beginning cannot be carried out. Normally, it is granted for businesses such as laundries, cafeterias, dry cleaners, and party halls, among others
- Permitted land use: this authorizes various types of business of the same classification, so it is possible to make changes in the activity carried out
At this point, it is worth mentioning that when commercial land is for sale, we must ensure that it has the necessary extension in square meters for the type of project that we are going to carry out.
At first glance, one might think that it is possible to build on the entire surface of the land. However, there is something called the property coefficient, which determines the amount of land that must be used in the construction and the amount that must be left in the open air.
However, the coefficient of the property can be called the participation coefficient, which should not be confused with the participation fee. To make this point clear, we briefly explain what each one refers to.
- Participation coefficient: It is the percentage assigned to each owner based on the surface of the property over the total of the farm
- Participation fee: Also called the participation fee of the community of owners, it is what determines the calculated percentage, taking into account other factors such as common areas, such as corridors and warehouses, as well as parking
Keeping this in mind will help you choose the land that best suits the needs of your project.
3. Services and Infrastructure
Thinking about its objectives, commercial land must have the infrastructure and basic services that allow the activities to be carried out correctly.
Among the main ones are: drinking water, electricity, drainage, public lighting, garbage collection, paved streets and facilities for other types of facilities such as gas, and communication services (telephone and Internet), among others that are required for the business.
This is important since many investment lands are far from the urban sprawl, making access to transportation services difficult, and they do not have an estimated date for the city council to carry out the urbanization work.
4. Preserve the Safety of Staff and Clients
The safety and well-being of people are fundamental aspects when thinking about land to open a business.
Due to the health problems that can cause people to be exposed for long periods of time, the land must be far from high voltage lines. Depending on their voltage, the distances are as follows:
- 155 thousand volt lines – 21 meters
- 230 thousand volt lines – 32 meters
- 400 thousand volt network – 42 meters
In the event that there is a gas plant in the vicinity, the distance between it and a business is 100 meters for the safety of the service personnel and the client.
5. Suitable Dimensions and Shape
Knowing what is the ideal surface for the business that is intended to be built will depend precisely on the activity that is going to be carried out.
In the same way, if you intend to rent to a specific franchise, you can investigate beforehand what the requirements are, for example, how many meters of frontage it must have as a minimum.
Regardless of the line of business, it should be considered that —being a business— it must have enough space for corridors, construction of sanitary services, emergency exits, etc.
6. Price
It might seem obvious, but the price is a key point to choose between an excellent piece of land or a problem in the future.
Among the many options that exist in the real estate market, the most common is to set the price in the first instance. This is because we already have a budget with which we have set the amount that we can invest.
Property prices vary depending on the area. In cities in Pakistan, the northern zone is the one with the best opportunities for large-scale luxury projects, the western zone for industrial projects, and the eastern zone for smaller businesses.
In addition to the added value and its growth potential, one must be cautious because many lands for sale are not regularized. For this reason, it will always be better to buy privately owned land than an ejido, to guarantee a safe purchase and with legal certainty.
Ejidal land is usually cheaper and this is the origin of a large number of real estate scams, since they belong to the state and cannot be traded with them.
If you are looking to buy land at a lower cost and with a higher return on investment margin, our recommendation is to pre-purchase with a serious company with experience in the field.
Acquiring Commercial Land is the Best Decision
Now that you know the key points to buy commercial land, all you have to do is find the right real estate company to help you find the perfect land for your project.
We are Sky Marketing, a company dedicated to the development of investment projects in the areas with the greatest growth potential in Pakistan.
Using our experience and based on the development, level of urbanization and road connectivity, we identify the most profitable areas of each city for the opening of businesses of different commercial lines, reducing the possibilities of a bad investment that generates losses.
We have professional and trained advisors to guide investors to make intelligent decision that strengthens their assets and generates income in the short and medium term.
Contact us so that one of our advisors can guide you on your investment opportunities in the areas with the greatest growth potential in Pakistan and help you to materialize this important heritage project.
