Solid Steps to Buying Property to Grow Your Business
By Dave Ash, Director of Business Development
Your business is growing, and you’re not sure where to start. Standing in the middle of a field doing a 360 evaluation and kicking some dirt around, you wonder if it’s the right place to grow? And, how do you really know?
When owners begin searching for a new site to build a new facility, there are a few things to be aware of and consider before any offers to purchase are made.
From an owner’s perspective, the desired location in most cases (and, depending upon the industry you are in) is the driving factor of the geographical area in which your search starts. Did you outgrow your existing location and it isn’t conducive to expand? In many instances, the first inclination is to stay close to your current operations. We can all be creatures of habit and a move that could add 10 to 15 minutes to a commute isn’t always well received.
We always hear about the importance of location, location, location. However, no matter the industry, every business has different site and location factors central to their specific needs and should be factored into strategic site selection--making location paramount!
Other key considerations include:
The size of your facility—what is the initial required space to build? As your business continues to grow, will there be a need for added space? How large of a building would you potentially need in the future? Once the general location, specific use, and building size has been determined, you can begin your search for that right piece of property.
Most municipalities have similar requirements for building lot coverage, setbacks, and general zoning requirements. Hiring a civil engineer familiar with the requirements in your area to assist in verifying zoning requirements, planning your site with your initial building size, while also considering a master plan showing maximum building size that the property will allow will be money well spent. Other factors to assess with your site as it relates to site planning are parking requirements (short- and long- term). Do you have truck dock requirements?
In most cases, when an offer is made, there is a due diligence period stated in your purchase agreement. This allows you time to further investigate the specifics of the site and a conceptual site layout from a civil engineer should be completed during this time.
If a survey with topographic elevations isn’t provided by the seller, the engineer can help obtain this information. The survey and the topographic ensure lot dimensions and potential easements are discovered before removing this contingency from your offer to purchase. It will also provide critical data in determining any potential for added site work costs. What are the existing soils on the property? How much fill do you need to give you the required building pad elevation?
Not as common, however, a critical element to also investigate during this discovery period, would be potential wetlands and floodplains that may exist on the targeted site.
So you can see, doing your homework up front before committing to your land purchase is a critical first step as you begin the exciting process of building your new facility!