Commercial real estate in Montreal

Good afternoon Quebec mortgage and real estate world. This week, I had an informal chat over coffee with Ron Wiebe from Ron Wiebe Realities. Ron's real estate agency specializes in commercial real estate and commercial leasing. As many of you know, commercial is an area that I am always interested in. Often, I feel I juggle residential and commercial real estate as many of clients own both types of property.

Ron and I launched into our chat by talking about new and seasoned commercial properties owners. I am always interested in servicing both types of clients especially folks that have a decent portfolio of residential properties and are looking to dive into commercial or their business needs them to expand to a commercial property. Ron shared with me that most people starting out a new business will typically lease some space before buying. Once the business becomes stabilized then you may be interested in finding a mortgage with similar payments as your lease. Ron says that "your first commercial building is the trick." He suggests that you plan 6-12 months in advance of buying. The most common mistakes is that people undervalue property and most do not realize that you may need 25-40% down payment on a commercial building. The type of building and revenue versus expenses will typically dictate amount of down payment required. Each bank and lender is slightly different.

Ron's main theme to keep in mind whether new or a veteran to commercial real estate is to "be pragmatic" and listen to your commercial real estate broker. If you trust your broker then listen to their advice and you may need to adjust your expectations. I agree with Ron that times change, meaning property values change as do lending rules. What you paid for years ago by square footage has changed. It is most likely inevitable. Having said that, Ron suggests that commercial market value will always be there. If permitting you should will always be looking to invest or operate your company somewhere you can call your own.

For more questions or comments about commercial financing feel free to contact me. Also, if you think of someone that might need my services please help make that introduction and let's start that conversation.