Is Build-to-Suit Right for You?

Chicago Real Estate

With smart technology and mobile apps that let us do just about anything anytime and anywhere, our culture has shifted from compromise to customize. Off-the-rack just isn’t suitable in many choices we face.

This same expectation applies to commercial real estate. You can look at existing buildings and retrofit them. That might work just fine, but is “just fine” what you want for your business as you move forward? Will those compromises become larger issues in the years ahead?

Even though existing buildings provide advantages for businesses seeking new locations, Build-to-Suit options may present a better option. With Build-to-Suit, you literally start from the ground up. You’re involved in the design and construction of your new facility, confident that you aren’t compromising because an existing building isn’t ideal. There are no concerns about the infrastructure—like wiring and heating ventilation and air conditioning (HVAC)—meeting today’s standards. You know that your site can handle the demand for a stronger wireless network. You don’t need to accept those constraints on location, size, or architectural detail.

Business owners also often find the highly competitive nature of today’s markets require a level of design flexibility that’s difficult to attain with existing properties. At Integrated Real Estate Solutions, it’s our job to match you to the commercial space that truly fits your needs, not convince you to accept the current inventory, just because it’s presently available. Build-to-Suit might be the right option for you, so let’s consider all the factors.

Location rules.

The old real estate axiom “location, location, location,” has always been important. That battle cry, however, doesn’t always mean you need to be situated on Main Street. Manufacturers, for example, need access to transportation for inbound and outbound shipping, Large businesses need a location that can offer a skilled labor pool that meets their needs. Different areas have different zoning regulations and tax rates (income, property, sales). You also need to ensure that your new neighborhood supports your company’s brand

It makes sense to understand your location needs before you begin your search, our team at Integrated Real Estate Solutions will work with you and your team to ensure you cover them in your search.

Energy–smart or money pit?

New construction reflects the most current eco-friendly practices, from the materials themselves to electrical and heating ventilation and air conditioning (HVAC) systems. Windows and building envelopes are improving insulation, which reduces your energy usage and costs.

Consider the cost of your electricity. New technologies are utilizing energy-efficient approaches that could significantly impact your energy costs in the years ahead.

Outdated energy infrastructure can come at a high price, so consider a building’s energy-efficiency before you commit to any location that could become an energy money pit. The short-term investment in improving your carbon footprint will deliver lasting ROI.

Buy or lease? You have a choice.

You can lease or buy your new building, whether it’s an existing structure or Build-to-Suit. While every organization’s tax circumstances are different, there are times when leasing offers distinct advantages over buying. Nevertheless, Build-to-Suit options can be structured as a lease back to the business or to be owned by the business. Along with our team at Integrated Real Estate Solutions, your treasurer, CFO, or accountant can help you decide which one is the better option.

For a more detailed look at your options for own versus lease, please see our article: To Lease or to Buy? When That Is the Question

Integrated Real Estate Solutions, Inc. provides clients with the in-depth knowledge and experience that is critical to determine the right path to your next move, lease renewal, or strategic repositioning of your real estate portfolio. Talk to us about your needs, and put our success to work for you.

Author: Jim Schnur

Jim Schnur is the President and Designated Managing Broker of Integrated Real Estate Solutions, Inc. Jim started the firm in 2003 after almost 20 years negotiating and overseeing real estate transactions at Hewlett Packard Co. and Agilent Technologies, Inc.