What Is A Ground Lease In Commercial Real Estate?

Ground leases are a strategic choice for investors and landowners alike. They present a balance of flexibility and stability, enabling businesses to secure prime locations without the substantial initial costs associated with land purchase, and they’ve had a profound influence on urban development and the expansion of businesses.

This piece aims to offer an overview of ground leases, highlighting their advantages, structure, and relevance in the current commercial real estate landscape. So first:

Defining Ground Leases

As you may already know, a ground lease is quite different from your typical property lease. Rather than leasing the land and the structure on it, a ground lease pertains exclusively to the land. Tenants lease this land (usually for a prolonged duration) and have rights to develop or enhance it. The legalities surrounding ground leases are carefully structured to safeguard the interests of every stakeholder, clearly delineating rights, duties, and development boundaries, which often reduces the likelihood of disputes.

A very notable characteristic of ground leases is their longevity, with contracts that can often span anywhere between 50 and 99 years. These extended durations offer tenants the assurance needed to invest in developing the property. Unlike conventional commercial leases that charge rent for the land and any existing infrastructure, ground leases grant tenants the autonomy to develop the land as they deem appropriate, while the landowner enjoys consistent rental revenue and eventually reclaims the enhanced property.

The Ground Lease Process

Initiating a ground lease starts with a proposal. Prospective tenants (typically businesses or developers with a specific location in mind) approach the landowner with their plan. This proposal details their vision for the land, the intended development, and the mutual advantages.

Following the proposal submission, negotiations ensue. During this collaborative phase, both the tenant and landowner iron out the lease’s specifics. They discuss and finalize crucial elements like lease terms, duration, and associated expenses. This stage is vital to ensure the lease benefits both parties and aligns with their long-term aspirations.

Once all terms are agreed upon, the lease is formalized and executed. The tenant can then commence their development, and the landowner starts receiving the stipulated rent.

Given their extended nature, ground leases include regular reviews. These assessments accommodate adjustments based on market dynamics, potential rent hikes, and future lease discussions. It’s also common for ground leases to contain renewal clauses, promoting sustained stability for the tenant’s ventures.

Ground Lease Varieties: Subordinated vs. Unsubordinated

Ground leases predominantly fall into two categories: subordinated and unsubordinated leases. Each type has its distinct features, advantages, and challenges, particularly from the tenant’s viewpoint.

Subordinated Ground Leases: In this arrangement, the landowner concedes priority regarding property claims, especially if the tenant encounters financial hurdles. If a tenant defaults on a development loan, the lender can seize the property as collateral. Lenders might find this lease type more appealing, potentially simplifying financing acquisition for tenants. However, if financial issues arise, tenants risk forfeiting their property investment to lenders.

Unsubordinated Ground Leases: Here, the landowner maintains primary rights concerning property claims. If a tenant defaults on their loan, the lender can’t seize the land but might target the tenant’s other assets. This setup safeguards the tenant’s property investment, ensuring the land remains intact even during financial crises. That said, acquiring financing could be slightly tougher as lenders might see a heightened risk without the land as possible collateral.

The decision between subordinated and unsubordinated leases depends on various factors from the tenant’s side, including financial health, long-term objectives, risk tolerance, and their rapport with lenders.

Ground Leases for Tenants: Benefits and Considerations

Ground leases present compelling opportunities for tenants, especially those aiming to gain traction in competitive arenas.

Benefits include:

  • Strategic Market Entry: Ground leases empower tenants to secure coveted spots without a significant initial land purchase outlay, especially valuable in thriving city centers or budding business zones.
  • Enhanced Brand Presence: Occupying prime locales can amplify brand visibility, drawing increased attention and potentially bolstering brand value.
  • Financial Agility and Growth Potential: Absent the land acquisition costs, tenants can judiciously allocate funds, emphasizing business scaling, infrastructure, and other expansion-driven endeavors.

Prospective tenants should also take the following into consideration:

  • Financing Hurdles and Remedies: While ground leases can offer financial leeway, they might introduce financing acquisition challenges, especially with subordinated leases. However, establishing robust equity stances or exploring alternative financing avenues can address these issues.
  • Potential Development Constraints: Ground leases could come with specific development directives or limitations. It’s imperative for tenants to comprehend these to ensure their operations conform to the lease stipulations.
  • Long-Term Engagement Implications: Ground leases are enduring contracts, often lasting several decades. Tenants must contemplate the long-term ramifications, ensuring the site and conditions resonate with their prospective business trajectory.

Final Thoughts

Ground leases meld financial adaptability, strategic brand positioning, and expansive potential. By facilitating businesses to mark their presence in prime locales without the substantial land acquisition expense, they unlock unmatched prospects. Whether you want to heighten your brand visibility, optimize resource distribution, or establish a presence in a high-stakes market, a ground lease can be the catalyst for your business’s future.

However, as with any pivotal business choice, it’s paramount to approach ground leases with an informed stance – and if you would like to talk with an expert as you navigate your options, Speed Commercial Real Estate has the knowledge and experience to help.

What Is A Good Cap Rate?

In the world of commercial real estate, understanding key metrics is essential for making informed and successful investment decisions. One such pivotal metric is the capitalization rate, commonly referred to as the “cap rate.” The cap rate serves as a reliable indicator of the potential rate of return on a commercial property, offering insights into its profitability and investment appeal.

Grasping the nuances of the cap rate is not just about crunching numbers; it’s about gauging the pulse of the market, assessing risks, and predicting future yields. For any commercial real estate investor, whether seasoned or just starting, mastering the concept of the cap rate is fundamental. It provides a lens through which the value and potential of a property can be viewed, ensuring that investments align with financial goals and market realities.

Understanding the Basics of Cap Rate

Diving deeper into the realm of commercial real estate, the cap rate stands out as a beacon for investors, guiding them towards profitable ventures. But what exactly does this metric entail?

At its core, the cap rate measures the expected rate of return on a commercial property. Think of it as a snapshot of the property’s potential profitability, given current market conditions. It’s a ratio that compares the annual net operating income of the property to its current market value.

This relationship is vital because it allows investors to quickly gauge the earning potential of a property relative to its price.

Key Factors Influencing Cap Rate

In the intricate tapestry of commercial real estate, the cap rate doesn’t exist in isolation. Several external factors can influence it, shaping the investment landscape and guiding decision-making processes. Let’s delve into some of these pivotal factors:

  • Economic Factors:
    • Interest Rates: A cornerstone of the financial world, interest rates play a significant role in determining cap rates. As interest rates rise, the cost of borrowing increases, often leading to a decrease in property values and an increase in cap rates. Conversely, lower interest rates can boost property values, potentially driving cap rates down.
    • Rent Growth: The trajectory of rent growth is closely tied to broader economic conditions. In a thriving economy, demand for commercial spaces often rises, leading to potential rent increases. This growth can result in a more attractive cap rate for investors. On the flip side, stagnant or declining economies can suppress rent growth, impacting cap rates adversely.
    • GDP and Unemployment: The overall health of the economy, as indicated by metrics like GDP and unemployment rates, can sway cap rates. A robust GDP coupled with low unemployment typically signals a strong economy, which can lead to lower cap rates due to reduced perceived risk. In contrast, a sluggish GDP and high unemployment can elevate cap rates, reflecting increased investment risks.
  • Location: The adage “location, location, location” holds especially true in commercial real estate. Proximity to thriving business hubs, accessibility to transportation networks, and closeness to essential amenities can enhance a property’s appeal, potentially driving down its cap rate. A prime location can command higher rents, ensuring steady revenue streams and a more favorable cap rate.
  • Market Dynamics: The commercial real estate market is a living entity, constantly evolving based on supply and demand dynamics. The presence of competing properties, emerging market growth trends, and unique local market features can all influence cap rates. For instance, an oversaturated market with numerous similar properties might lead to competitive pricing, affecting cap rates. Conversely, a market with limited supply and high demand can command premium prices, reflecting in the cap rate.

In essence, while the cap rate is a powerful tool, it’s essential to view it in the context of these influencing factors to paint a complete picture of the commercial real estate landscape.

Formula and Calculation of Cap Rate

The cap rate, while a simple concept, is underpinned by a precise formula that offers investors a clear lens into the potential returns of a commercial property. Let’s break down this formula and its components:

Capitalization Rate = Net Operating Income (NOI)/Current Market Value

  • Net Operating Income (NOI): This is the annual revenue generated from the property after deducting all operational expenses, but before accounting for financing costs. In the commercial real estate context, NOI can be influenced by factors such as lease agreements, property management costs, maintenance expenses, and more. It’s essential to ensure that all revenue streams and operational costs are accurately accounted for to determine a realistic NOI.
  • Current Market Value: This represents the present value or purchase price of the commercial property in question. Determining the current market value requires a comprehensive understanding of the property’s location, size, condition, and comparable sales in the vicinity. It’s also influenced by broader market dynamics, such as demand and supply trends in the commercial real estate sector.

By plugging in accurate values for NOI and the current market value into the formula, investors can derive the cap rate, giving them a snapshot of the property’s potential yield. It’s worth noting that while the formula provides a numerical value, interpreting this value in the context of the broader market and individual investment goals is crucial for making informed decisions.

Interpreting Cap Rate Values

In the realm of commercial real estate, numbers and percentages are more than just figures; they tell a story. The cap rate, in particular, narrates the tale of a property’s potential and the opportunities it presents.

  • Yield Over a One-Year Horizon: The cap rate essentially provides a snapshot of the expected return on a commercial property over a one-year period, assuming the property is purchased outright. It’s a projection of the property’s yield, giving investors a quick insight into its earning potential without the influence of financing or external market factors.
  • Risk and Return Dynamics: Different cap rates can paint varying pictures of risk and return:
    • Lower Cap Rates (e.g., 4% – 6%): Often associated with lower risk, these rates might indicate properties in prime locations or stable markets. The return potential might be steady, but the initial investment recovery could take longer.
    • Higher Cap Rates (e.g., 8% – 10% and above): These might signify higher potential returns but come with increased risks. Such properties might be in emerging markets or areas undergoing development, presenting both challenges and opportunities for investors.

While the cap rate is a valuable metric, interpreting its value requires a blend of market knowledge, foresight, and strategic thinking. It’s not just about the numbers but understanding the story they tell about the property’s potential in the vast commercial real estate landscape.

Gordon Model Representation for Cap Rate

In the multifaceted world of commercial real estate investment, various models and theories help investors navigate their decision-making processes. One such influential model is the Gordon Growth Model, which offers a unique perspective on the cap rate.

The Gordon Growth Model, often referred to as the Dividend Discount Model, is traditionally used to value stocks by considering dividends that are expected to be received in the future. However, its principles can be seamlessly applied to the realm of commercial real estate, especially when evaluating the cap rate.

At its essence, the Gordon Growth Model suggests that the value of an investment is derived from its future dividends (or in the case of real estate, future rental incomes) and the expected growth rate of these dividends. When we transpose this to the commercial real estate context, the cap rate becomes analogous to the difference between the required rate of return on a property and its expected income growth rate.

The formula can be represented as: Cap Rate = Required Rate of Return − Expected Growth Rate of Income

For instance, if an investor seeks an 8% return on a commercial property and expects the rental income to grow at 3% annually, the cap rate, as per the Gordon Growth Model, would be 5%.

The Gordon Growth Model provides a fresh lens through which commercial real estate investors can view and evaluate cap rates. By understanding the relationship between required returns and expected growth, investors can make more nuanced and informed decisions, ensuring their ventures align with both market dynamics and individual investment goals.

Limitations and Considerations

While the cap rate stands as a formidable tool in the arsenal of commercial real estate investors, it’s crucial to recognize that no single metric can capture the full complexity of the investment landscape. Relying solely on the cap rate can lead to an oversimplified view of a property’s potential.

Let’s delve into some of the limitations and considerations associated with the cap rate.

Limitations of the Cap Rate:

  1. Snapshot, Not a Movie: The cap rate offers a snapshot of a property’s potential return at a specific point in time. It doesn’t account for how this return might evolve over the years, especially in the face of changing market conditions.
  2. Excludes Financing Costs: The cap rate calculation assumes a property is purchased outright, without any financing. In reality, many commercial properties are bought with a mix of equity and debt, which can significantly influence the actual returns.
  3. Overlooks Property-Specific Factors: Two properties with the same cap rate might have vastly different maintenance costs, tenant profiles, or lease agreements. The cap rate doesn’t factor in these nuances, which can impact the overall profitability of an investment.

Key Considerations:

  1. Future Risks: While the cap rate provides insights based on current conditions, it’s essential to consider potential future risks. This includes changes in the economic environment, shifts in tenant demand, or unforeseen maintenance challenges.
  2. Market Fluctuations: The commercial real estate market is dynamic. Factors like emerging market trends, supply and demand dynamics, and local market features can influence property values and rental incomes, impacting the cap rate.
  3. Holistic Analysis: Instead of relying solely on the cap rate, investors should adopt a holistic approach, considering other metrics like the Net Present Value (NPV) or Internal Rate of Return (IRR). This comprehensive analysis ensures a more rounded understanding of an investment’s potential.

While the cap rate is undeniably valuable, it’s just one piece of the puzzle. Successful commercial real estate investment requires a blend of quantitative analysis, market insights, and forward-thinking strategy. By recognizing the limitations of the cap rate and considering a broader range of factors, investors can make decisions that are both informed and strategic.

Ideal Cap Rate Range for Commercial Properties

What constitutes an “ideal” cap rate for commercial properties?

In the commercial real estate sector, a cap rate falling between 5% to 10% is often viewed as a favorable range. Properties within this cap rate spectrum typically strike a balance between risk and return, offering investors a reasonable expectation of profitability.

While the 5% to 10% range provides a general guideline, it’s essential for investors to recognize that the “ideal” cap rate is not set in stone. It’s a fluid figure, influenced by a myriad of factors. Successful commercial real estate investment hinges on understanding these nuances, ensuring that decisions are based on a comprehensive analysis of the market, the property, and broader economic conditions.


As we wrap up our exploration into the world of cap rates in commercial real estate, it’s evident that this metric stands as a cornerstone for informed investment decisions. The cap rate offers a window into the potential profitability of a property, providing a snapshot of its expected return relative to its value.

However, as with any tool, its efficacy lies in how it’s used. While the cap rate is undeniably valuable, it’s just one piece of the broader commercial real estate puzzle. Relying solely on it can lead to an oversimplified view of an investment’s potential. It’s crucial to interpret cap rates within the context of the broader market, economic conditions, and specific property nuances.

Moreover, for a truly holistic investment strategy, it’s imperative to use the cap rate in tandem with other metrics, such as Net Present Value (NPV), Internal Rate of Return (IRR), and more. This comprehensive approach ensures that investors are equipped with a multi-faceted view, allowing them to navigate the complexities of the commercial real estate market with confidence and foresight.

And if you’re interested in investing in commercial real estate, Speed Commercial Real Estate has the expertise and experience to help you do that. Get in touch today for more information.

How To Navigate Zoning Laws In Commercial Real Estate

Navigating the complex world of zoning laws is a crucial aspect of commercial real estate investment. These laws, which govern how a property can be used, can significantly impact the value and potential of your investment. Understanding them isn’t just about knowing the rules—it’s about unlocking opportunities and mitigating risks.

In this piece, we’re going to unpack the complexities of zoning laws, exploring everything from their fundamental concepts to their far-reaching implications on commercial properties. We’ll also take a closer look at the unique zoning laws in Mississippi and how they shape the local commercial real estate landscape. Regardless of whether you’re an experienced investor or a newcomer to the field, this guide is designed to arm you with the insights you need to confidently steer through zoning laws in your commercial real estate pursuits. Let’s demystify zoning laws together and turn them into your strategic advantage.

What Are Zoning Laws?

Zoning laws, at their core, are the rules that dictate how parcels of land in specific geographic zones can be used. They fulfill a vital role: they designate residential, commercial, industrial, and agricultural zones, ensuring these varied uses don’t clash with each other. This separation not only helps maintain the character and quality of life within communities, but it also helps protect property values.

Zoning categories are diverse. The most common are residential, commercial, industrial, and agricultural, and each category carries a distinct set of regulations and restrictions. For instance, commercial zoning typically covers office buildings, shopping centers, and hotels, while industrial zoning is reserved for manufacturing and other heavy industries.

The concept of zoning isn’t new, but the form of zoning laws we recognize today took shape in the early 1900s. They’ve evolved over time to adapt to changing societal needs and urban development trends.

Understanding zoning laws is crucial in the realm of commercial real estate. These laws can significantly influence the use, value, and potential of a property. For example, a parcel zoned for commercial use typically cannot be used for residential purposes, and vice versa. That’s why it’s crucial for investors and developers to fully grasp zoning laws when they’re weighing up a potential real estate investment or development project. They can significantly impact the feasibility, profitability, and legal compliance of your real estate endeavors.

The Impact of Zoning Laws on Commercial Real Estate

Zoning laws play a pivotal role in shaping the commercial real estate landscape. They directly influence what can be built where, and this, in turn, impacts the value and potential uses of a property. For instance, a plot zoned for commercial use in a bustling city center will likely have a higher value than the same plot zoned for agricultural use due to the potential for higher revenue generation.

Let’s use a couple of examples to demonstrate how zoning laws can affect commercial real estate projects:

  1. Retail Development. A developer plans to build a shopping center on a plot of land, but the land is currently designated for residential use. The developer must apply for a rezoning to commercial use. If the rezoning request is denied, the potential use—and therefore the value—of the land is significantly diminished for the developer.
  2. Industrial to Residential Conversion. An old factory building located in an area zoned for industrial use is purchased with the intent to convert it into loft-style apartments. The investor must apply for a variance or rezoning to residential use. If approved, this change can significantly increase the property’s value due to the higher revenue potential of residential units compared to the previous industrial use.

These examples underscore the importance of understanding zoning laws when planning commercial real estate projects. They can either pave the way for successful developments or pose significant hurdles, depending on how well they’re navigated. Therefore, a comprehensive understanding of these laws is a vital tool in the arsenal of every commercial real estate investor or developer.

How to Find Zoning Information

Finding zoning information for a specific property is a crucial step in the due diligence process of any commercial real estate endeavor, and there are a variety of places you can do that.

  1. Local Government Websites: Many city or county websites have zoning maps and information available online. Look for a section on the website related to planning, zoning, or land use. Resources like ZoningPoint (which we mention again later) can help you simplify your research.
  2. Local Planning Office: If the information isn’t available online, you can contact your local planning or zoning office. They can provide you with the zoning classification for a specific property and any related regulations.
  3. Real Estate Agent or Broker: Professionals in the real estate industry often have access to detailed property data, including zoning information. They can be a valuable resource in your search.

Once you’ve found the zoning information, interpreting it is the next step. Zoning codes may initially appear to be a baffling mix of letters and numbers, but they are more intuitive than they seem. Typically, the codes are abbreviations for the zoning classification. ‘R’ usually represents residential, ‘C’ stands for commercial, and ‘I’ signifies industrial. The numbers usually indicate specific regulations within that classification, such as the level of density allowed.

Zoning maps, on the other hand, use colors to represent different zoning classifications across specific geographic areas. By locating your property on the map, you can see its zoning classification and those of the surrounding properties.

If you’re unsure of the details, seek professional advice to confirm that you’re interpreting the codes accurately.

Navigating Zoning Restrictions and Changes

Zoning restrictions can sometimes pose challenges to your commercial real estate plans. However, there are mechanisms in place that can allow for flexibility: variances and rezoning.

A variance is a request to deviate from current zoning requirements. It’s typically granted when the zoning ordinance would cause unnecessary hardship due to the property’s unique characteristics. For example, a variance might allow for a building to exceed height restrictions if it’s necessary to achieve a certain architectural design.

Rezoning, on the other hand, is a change in the zoning classification of a property. This is usually sought when the current zoning doesn’t allow for the intended use of the property. For instance, you might request rezoning from residential to commercial if you plan to build a retail store on a plot currently zoned for residential use.

If you need to apply for a variance or rezoning, here are the general steps you’d follow:

  1. Pre-Application Meeting: This is usually an informal meeting with the local planning department to discuss your proposal and understand the application process.
  2. Application Submission: You’ll need to submit a formal application that includes details of your proposal and the reasons for the request. This often includes site plans, architectural drawings, and a statement of justification.
  3. Public Notification and Hearing: Usually, there is a public hearing where you can present your proposal, and community members have the opportunity to express their support or concerns.
  4. Decision: The local planning commission or board will make a decision based on the zoning laws, your proposal, and the public input. If approved, the variance or rezoning becomes legally binding.

This process may differ based on local laws and regulations, so it’s beneficial to consult with a local planning official or a real estate professional who is familiar with the area.

An Overview of Mississippi Zoning Laws

Zoning laws in Mississippi, as in other states, are implemented to control land use across the state. However, Mississippi’s zoning laws have unique characteristics.

In Mississippi, each city or county individually formulates zoning laws at the local level, which means the zoning laws in one part of Mississippi may not align with those in another. For example, different cities or counties within Mississippi have comprehensive Zoning Ordinances that provide for the administration, enforcement, and amendment of zoning regulations within their jurisdictions.

The impact of Mississippi’s zoning laws on commercial real estate is significant, and a property’s zoning classification can determine the feasibility of commercial development projects. For example, suppose you have a property that’s currently zoned as residential. If you’re a developer looking to build a commercial project there, you’ll first need to request a rezoning to commercial use.

For a deeper understanding of Mississippi’s zoning laws, engaging with local planning departments or real estate experts well-versed in the state’s regulations can be invaluable. We’ve also provided some beneficial resources below to assist in initiating your research.

The Role of Real Estate Professionals in Navigating Zoning Laws

Zoning laws can be complex to navigate, particularly for those new to the nuances of commercial real estate, but this is where the expertise of real estate professionals becomes invaluable. Their knowledge can be invaluable in understanding and navigating these laws.

  • Commercial Real Estate Brokers: These professionals have a deep understanding of the local real estate market, including zoning regulations. They can provide guidance on how zoning laws might impact the value and potential uses of a property. They can also assist in finding properties that meet your specific zoning requirements.
  • Real Estate Lawyers: Lawyers specializing in real estate can provide legal advice on zoning laws and their implications. They can help interpret complex zoning ordinances, represent you in zoning disputes, or assist in applying for variances or rezoning.
  • Urban Planners: These professionals have a comprehensive understanding of land use policies, including zoning laws. They can provide insights into how zoning changes might affect a property and can help in planning development projects that comply with zoning regulations.
  • Architects and Engineers: When planning a development project, these professionals can design structures that comply with zoning laws. They can also help identify potential zoning issues that might affect a project.

In conclusion, while zoning laws can be complex, you don’t have to navigate them alone. By leveraging the expertise of real estate professionals, you can make informed decisions and ensure your commercial real estate endeavors comply with all relevant zoning regulations.


Understanding zoning laws is a fundamental aspect of investing in and developing commercial real estate. These laws, which dictate how a property can be used, can significantly influence the value, potential, and feasibility of your real estate projects. From the basic principles of zoning to the unique aspects of Mississippi’s zoning laws, we’ve explored how these regulations shape the commercial real estate landscape.

Navigating zoning laws can be complex, but remember, you’re not alone in this journey. Seeking professional advice can make the process much smoother and help you avoid potential pitfalls. Real estate brokers, lawyers, urban planners, and architects all play crucial roles in helping investors and developers understand and navigate these laws.

At Speed Commercial Real Estate, we’re here to assist you with all your commercial real estate needs. Our team of experienced professionals can provide guidance on zoning laws and other critical aspects of commercial real estate. Whether you’re planning a development project or hunting for the ideal investment property, we stand ready to assist you in making knowledgeable decisions that align with your goals.

In the world of commercial real estate, knowledge is power – and understanding zoning laws can give you the strategic advantage you need to succeed. So, don’t hesitate to reach out to us at Speed Commercial Real Estate for assistance. Let’s turn zoning laws from a challenge into an opportunity together.

What Is A Commercial Energy Audit?

Understanding the energy consumption of commercial buildings is a critical aspect of efficient business operations in today’s world. This is where a commercial energy audit comes into play.

A commercial energy audit is a systematic process that examines and analyzes the energy usage and efficiency of a commercial building, aiming to identify potential areas of improvement and savings.

And the reality is that commercial energy audits are no longer just an option—they have become a necessity. They offer a strategic avenue for businesses to not only reduce operational costs but also to meet increasingly stringent sustainability targets.

As we delve deeper into this topic, we will explore the process, benefits, and different types of commercial energy audits, shedding light on why energy audit services are a vital investment for businesses today.

Detailed Explanation of Commercial Energy Audits

A commercial energy audit, by definition, is a detailed assessment of a commercial building’s energy use. The main goals of an energy audit are to identify how a building uses energy and pinpoint areas where energy usage can be reduced.

The process of a commercial energy audit is comprehensive and typically includes several key components:

  1. Analysis of Energy Consumption: This is the first step where the energy audit companies assess the building’s energy consumption patterns. This involves reviewing utility bills and meter data, and examining the building’s operational characteristics and equipment.
  2. Identification of Potential Energy Efficiency Measures: Post the consumption analysis, the auditor identifies areas where energy efficiency can be improved. This could range from recommending changes in operational practices to proposing upgrades to energy systems, such as lighting – a focus area in an energy audit lighting review.
  3. Cost-Benefit Analysis of Proposed Efficiency Measures: Once energy-saving opportunities are identified, a cost-benefit analysis is conducted. This crucial step assesses the financial implications of implementing the proposed measures, weighing the initial investment against the expected energy cost savings.

In essence, a commercial energy audit offers a clear roadmap to energy efficiency, highlighting where changes can be made for maximum impact.

The Significance of Commercial Energy Audits for Businesses

The value of commercial energy audits for businesses extends far beyond the surface. Let’s explore two key areas where these audits play a significant role: controlling operational costs and bolstering corporate sustainability initiatives.

Controlling Operational Costs

For any business, operational cost control is a strategic imperative. Energy costs, often a substantial part of these expenses, can be effectively managed with a commercial energy audit. By identifying where energy is being wasted and suggesting efficiency measures, energy audits can result in substantial savings. These savings not only impact the bottom line positively but also enhance the overall operational efficiency of the business.

Role in Corporate Sustainability Initiatives

Today, sustainability is a requirement for future-focused businesses. Many businesses are undertaking sustainability initiatives as a part of their corporate social responsibility. Here, energy audits play a pivotal role. By identifying opportunities for reducing energy consumption and carbon emissions, they help businesses meet their sustainability goals. Moreover, an energy-efficient building has a smaller carbon footprint, contributing to a company’s green initiatives.

In essence, commercial energy audits serve as a strategic tool for businesses, helping control costs and drive sustainability efforts, making them an integral part of modern business operations.

The Process of a Commercial Energy Audit

Step-by-step Walkthrough of a Typical Energy Audit Process

The process of a commercial energy audit can be broadly divided into three levels:

  1. Preliminary Audit (Level 1): Also known as a walk-through audit, this initial stage involves a brief review of the facility’s energy usage and costs. It aims to identify glaring inefficiencies and provides a rough estimate of potential savings.
  2. General Audit (Level 2): This detailed energy audit involves a thorough building survey and energy consumption analysis. The auditor collects detailed data about the building’s characteristics and operational parameters. Energy consumption patterns are studied, and energy-saving opportunities are identified and quantified.
  3. Investment-Grade Audit (Level 3): This is the most detailed level of energy audit. It involves a detailed building survey and the use of sophisticated tools to model and simulate building and system performances. It provides detailed project costs and savings calculations and is suitable for businesses ready to implement substantial energy-saving projects.

The Role and Qualifications of Energy Auditors

Energy auditors are the driving force behind successful energy audits. They have a deep understanding of energy systems and the ways buildings consume energy.

Qualified auditors should have a strong background in energy management and a thorough understanding of the commercial building systems. They use their expertise to identify energy-saving opportunities and recommend effective measures to improve a building’s energy efficiency.

The commercial energy audit process is a thorough and comprehensive approach to understanding and improving a building’s energy performance. It plays a critical role in helping businesses reduce their energy costs and achieve their sustainability goals.

Benefits of Conducting a Commercial Energy Audit

Potential Cost Savings and ROI from Implementing Audit Recommendations

One of the most immediate and tangible benefits of a commercial energy audit is the decrease in expenses that comes with an energy efficient building. Energy audit companies are skilled at identifying areas of waste and inefficiency, and following their recommendations often leads to significant reductions in energy usage.

We’ve often seen savings of 20-30% in other properties which results in a major return on investment, especially over the long-term. ROI will, of course, depend on the types of upgrades implemented – but in many cases the improvements pay for themselves in just a few years.

Environmental Benefits and Contribution to Corporate Sustainability Goals

Aside from the financial benefits, commercial energy audits also contribute to environmental sustainability. By reducing a building’s energy consumption, we decrease the demand for energy production as well. This positive environmental impact aligns well with corporate sustainability goals, helping businesses meet their commitments to environmental stewardship. Moreover, these efforts can enhance a company’s reputation, leading to increased customer and client trust.

Put simply, commercial energy audits offer a win-win scenario, providing businesses with a route to save money while also contributing positively to the environment and to positive customer sentiment.

Final Thoughts

Commercial energy audits serve as a critical tool for both cost control and sustainability efforts. By offering a detailed understanding of a commercial building’s energy consumption, these audits identify opportunities for savings and efficiency improvements. The potential for cost reduction, coupled with the environmental benefits, makes commercial energy audits an indispensable part of any business’s energy management strategy.

If your business is on the lookout for ways to enhance its operational efficiency and contribute to sustainability initiatives, a commercial energy audit is a great step to take. Leveraging energy audit services can provide a detailed roadmap to energy efficiency, making your commercial buildings more sustainable and cost-effective.

If you are interested in learning more or if you’d like to get started on a commercial energy audit, our team at Speed Commercial Real Estate is ready. Give us a call or send us a message and we’ll help you move forward.

8 Reasons To Hire A Property Manager

Navigating the complexities of commercial real estate becomes significantly more manageable when you enlist the expertise of a property manager.

By taking on various responsibilities, property managers help optimize your investments and ensure smooth operations. Whether it’s setting accurate rental rates based on market trends, finding reliable tenants, or maintaining efficient rent collection, property managers are an essential asset for busy investors. Their services also extend to handling vendor relationships, legal matters, and conducting routine inspections.

In this article, we explore eight reasons why hiring a property manager is a smart move for your commercial real estate ventures.

What Is A Property Manager?

A property manager is a professional who specializes in overseeing the daily operations of commercial real estate properties. Their primary role is to ensure properties are well-maintained, profitable, and in compliance with relevant laws and regulations.

Key responsibilities of a property manager include setting rental rates based on market trends, marketing vacant spaces, screening and selecting tenants, and enforcing lease agreements. They also manage rent collection, financial records, property maintenance, and tenant relations.

Benefits Of Hiring A Property Manager

    1. Expertise and Experience: Property managers possess a wealth of knowledge and experience in managing various property-related matters. Their expertise extends to understanding local real estate laws, such as zoning ordinances and building codes, and staying informed about evolving regulations that can impact your property.For example, a property manager’s familiarity with the local commercial real estate landscape can help identify potential opportunities for your property, such as expanding into a new market or making strategic property improvements to attract higher-paying tenants. Additionally, they may be aware of tax incentives, grants, or other programs that could benefit your property and increase its overall profitability.


    1. Tenant Screening and Selection: Thorough tenant screening is crucial to ensure quality tenants occupy your commercial property. Property managers follow a systematic process to evaluate prospective tenants, reducing the risk of renting to unreliable or problematic occupants.The screening process typically includes:
      • Running background checks to review credit history, criminal records, and eviction history
      • Verifying income and employment to ensure the prospective tenant has a stable source of income
      • Contacting previous landlords or property managers for references and feedback on the tenant’s past behavior and payment history

      A property manager may also evaluate a prospective tenant’s compatibility with your property’s specific requirements, such as suitability for the type of business or industry the property caters to. This careful screening process helps minimize the risk of late payments, property damage, or legal disputes, and contributes to maintaining a stable and profitable tenant base for your commercial property.


    1. Marketing and Advertising: A property manager plays a crucial role in effectively marketing your commercial property to minimize vacancies and attract high-quality tenants. Their marketing strategies include creating compelling and accurate property listings, showcasing properties in a professional and appealing manner, and reaching a wider audience through various channels.Some of the marketing strategies employed by property managers include:
      • Crafting well-written and visually appealing listings that highlight the property’s unique features and benefits
      • Utilizing professional photography and virtual tours to showcase the property in its best light
      • Leveraging online advertising platforms, social media, and industry-specific websites to maximize exposure
      • Networking with other real estate professionals and local businesses to tap into potential tenant leads

      By employing a comprehensive marketing approach, property managers ensure your commercial property gains the visibility it needs to attract the right tenants, helping to maintain consistent occupancy and rental income.


    1. Rent Collection and Financial Management: Efficient rent collection and sound financial management are essential for maintaining the profitability of your commercial property. Property managers handle these aspects by implementing effective systems and processes to streamline rent collection and ensure compliance with lease agreements.Property managers also establish a network of reliable and cost-effective contractors for various maintenance and repair needs. They respond promptly to tenant-reported issues and handle emergency situations efficiently as well, ensuring the property remains in excellent condition and providing a safe and comfortable environment for tenants.


    1. Property Maintenance and Repairs: Regular property maintenance and timely repairs are crucial to preserving the value of your commercial property and ensuring tenant satisfaction. Property managers take on this responsibility, ensuring the property remains in optimal condition and adheres to any applicable building codes or regulations.Key aspects of property maintenance and repairs include:
      • Conducting routine inspections to identify and address potential issues before they escalate
      • Coordinating and overseeing regular maintenance tasks, such as landscaping, cleaning, and HVAC system servicing
      • Establishing a network of reliable and cost-effective contractors for various maintenance and repair needs
      • Responding promptly to tenant-reported issues and handling emergency situations efficiently

      By proactively addressing maintenance and repairs, property managers contribute to a well-maintained property that retains its value, attracts and retains quality tenants, and minimizes potential liabilities.


    1. Legal Compliance: Adhering to legal requirements and regulations is essential in property management to avoid costly fines, penalties, or potential lawsuits. Property managers are knowledgeable about local, state, and federal regulations that impact commercial properties, ensuring your property remains compliant.They ensure that lease agreements align with current laws and protect the property owner’s interests.Property managers adeptly manage eviction processes and other legal disputes in accordance with applicable laws and procedures. Furthermore, they coordinate compliance with essential requirements such as accessibility standards, fire safety regulations, and other mandatory building codes, helping to minimize the risk of non-compliance and ensuring your commercial property operates within the boundaries of the law.


    1. Tenant Communication and Conflict Resolution: Property managers serve as the primary point of contact for tenants, handling their concerns and inquiries professionally and promptly.They are skilled at mediating disputes between tenants or between tenants and the property owner, ensuring fair resolutions are reached. By implementing clear communication channels, like email or a tenant portal, property managers facilitate easy and efficient information exchange.They also keep tenants informed about any property-related news, changes, or upcoming events, fostering a positive atmosphere and harmonious environment within the property.By managing these interactions skillfully, property managers foster a positive atmosphere that encourages tenant retention, minimizes conflicts, and promotes a stable and enjoyable environment for all occupants.


  1. Maximize Property Income and Investment Returns: Property managers play a vital role in optimizing rental income and enhancing the overall investment returns of your commercial property. Their expertise in setting competitive rental rates and identifying opportunities for property improvement helps to maximize profitability.Property managers employ several key strategies to maximize property income and investment returns, such as conducting regular market analysis to determine appropriate rental rates based on local market conditions and property features. They identify and recommend cost-effective property improvements or upgrades that can attract higher-paying tenants or increase the property’s value.Additionally, they monitor vacancy rates and tenant turnover to develop strategies for maintaining consistent occupancy and rental income.By implementing efficient property management practices, they minimize operating costs and maximize net operating income, ensuring your commercial property generates optimal rental income and remains competitive in the market, ultimately leading to increased long-term investment returns.


Partnering with a property manager for your commercial real estate investments allows you to focus on strategic growth while leaving daily management to the experts. Speed Commercial Real Estate is committed to providing property management services to help you achieve a well-maintained and profitable property.

Don’t let property management complexities hinder your investment potential. Contact Speed Commercial Real Estate today, and let our experienced team ease the burden of property management, granting you the freedom and peace of mind to confidently pursue your investment goals.

Should I Hire a Property Manager?

If you’re looking to hire a property manager, there’s a lot to consider, and the importance of property management in commercial real estate cannot be overstated.

As a property owner, deciding whether to hire a property manager is crucial. There’s a lot to consider (and as an early note, if you don’t want to worry about all of this alone, I highly recommend reaching out to us to help you).

That said, this blog post explores the pros and cons of engaging a professional property management company, factors influencing fees, and tips for selecting the right manager – so let’s dig in.

The Pros of Hiring a Property Management Company

Expertise in handling property management tasks

One of the main reasons to hire a property manager is their expertise in managing commercial real estate and managing rental properties.

Property managers are well-versed in the day-to-day operations of commercial properties, including collecting rent, managing tenants, and handling maintenance requests. They also have a deep understanding of the local real estate market, which can help you set a competitive rent price.

Network of Contractors & Support Personnel

A good property management company will have an extensive network of reliable contractors, suppliers, and support personnel. This means that they can quickly address maintenance issues and provide high-quality services at competitive prices.

In addition, experienced property managers can often negotiate better deals with contractors due to their volume of business.

Tenant screening and management

Hiring a property management company means that they will handle the tenant screening process, ensuring that only qualified tenants occupy your commercial property.

This can save you time and minimize the risk of problematic tenants. Additionally, property managers are experienced in handling tenant disputes and can help maintain positive tenant relationships.

Compliance with laws and regulations

Property managers are knowledgeable about the various laws and regulations that apply to commercial real estate properties. They can help ensure that your rental property complies with all relevant rules, minimizing the risk of legal issues.

Maximizing rental income

An experienced property manager will be able to help you set a competitive rent price and minimize vacancies in rental units. They can also help you make strategic improvements to your property, attracting higher-paying tenants and increasing your rental income.

The Cons of Hiring A Property Management Company

Property management fees and costs

One of the main drawbacks of hiring a property management company is the associated cost. Property management service fees can vary based on the services provided, the size and location of your property, and the management company you choose. It’s essential to carefully consider the property management fees and weigh them against the potential benefits.

Potential lack of control for property owners

By hiring a property management company, you may feel a sense of reduced control over your commercial property. Some property owners may struggle with delegating the responsibility of managing their property to a third party.

It’s essential to establish a strong working relationship with your property manager and maintain open communication to alleviate this concern. It’s also worth remembering that your time is valuable, and giving up some control to a trustworthy property management company can free you up to focus on other things.

Possible conflicts of interest

Some property management companies may manage multiple properties, which could lead to potential conflicts of interest. For example, a property manager may prioritize one property over another due to higher commissions or a personal relationship with a specific property owner. Because of this, it’s crucial to carefully research property management firms and interview potential property managers to ensure their commitment to your property’s best interests.

Varying quality of service among property managers

Not all property managers are created equal, and the quality of service you receive can vary significantly from one manager to another.

You should always carefully research and interview potential property managers to ensure you find a professional who will provide high-quality service and meet your expectations.

Factors that Affect Property Management Fees

Property size and location

The size and location of your commercial property can have a significant impact on property management fees. Larger properties or properties located in high-demand areas may command higher fees due to the increased workload and complexity involved in managing them.

Services provided

Property management fees can vary based on the services provided by the management company. Some companies offer comprehensive packages that include everything from rent collection to maintenance, while others provide more limited services.

Be sure to discuss the specific services included in the fees and any additional costs that may arise.

New Tenant Placement Fees

Some property management companies charge a separate fee for finding and placing new tenants in your commercial property. These fees can be a flat fee or a percentage of the first month’s rent.

Be sure to discuss these fees with your prospective property manager and factor them into your overall property management costs.

Leasing and maintenance fees

Leasing and maintenance fees can also affect your property management costs. Some property managers may charge a flat fee for leasing services, while others may charge a percentage of the monthly rent.

Maintenance fees can be either a flat monthly fee or based on the actual cost of repairs and maintenance performed.

It’s crucial to understand the fee structure and any additional costs before signing a property management agreement.

What Are The Benefits Of Hiring A Property Manager?

Time savings for property owners

One of the most significant benefits of hiring a property manager is the time savings for the real estate investor and property owners. Managing a commercial property can be time-consuming and stressful, especially if you own multiple properties.

By hiring a property manager, you can delegate these tasks and focus on other aspects of your real estate investment or business.

Stress reduction

Managing tenants, handling maintenance requests, and dealing with other property-related issues at own properties can be stressful.

Hiring a property manager can significantly reduce the stress associated with managing commercial properties, allowing you to enjoy the benefits of your investment without the headaches.

Better tenant retention

A professional property manager can help improve tenant retention by promptly addressing their needs and concerns.

This can lead to longer lease agreements and fewer vacancies in rental properties, which can ultimately result in higher rental income.

Lower maintenance costs

Property managers can often negotiate better deals with contractors and suppliers due to their volume of business managing multiple properties.

This can result in lower maintenance costs for your commercial property.

How to Hire a Property Manager

Assess your needs and goals

Before hiring a property manager, take the time to assess your needs and goals for your commercial property.

Determine the level of involvement you want to have and the services you require from a property manager. This will help you find a property management company that aligns with your needs and expectations.

Check Reviews and Online Presence

Research prospective property managers by checking their online presence, including their website and social media profiles.

Look for client reviews and testimonials to get an idea of their reputation and the quality of service they provide.

Interview Prospective Property Managers

Interview multiple property managers to ensure you find the best fit for your commercial property. Ask about their experience, services offered, fees, and how they handle common property management issues.

It’s also essential to ask for references from current or past clients to get an idea of their performance and reliability.

Review Property Management & Lease Contracts

Before signing a lease agreement or property management agreement, carefully review the contract terms, including fees, services provided, and termination clauses. Ensure you understand the property management fee structure, lease agreements, and any additional costs or responsibilities.

Frequently Asked Questions about Property Management

Answers to the questions provided in the instructions

  • What is a property manager’s first responsibility to the owner? A property manager’s first responsibility is to protect the owner’s investment by effectively managing the property and maintaining its value. This includes finding and retaining tenants, collecting rent, overseeing maintenance, and ensuring compliance with laws and regulations.
  • How often should a property manager inspect the property? The frequency of property inspections can vary depending on the property manager and the specific needs of the property. Generally, it’s a good idea for property managers to conduct inspections at least once or twice a year, or more frequently if there are ongoing maintenance issues or tenant concerns.
  • What is the average property management fee for commercial properties? The average property management fee for commercial properties typically ranges from 4% to 12% of the monthly rental income, depending on the size and location of the property, the services provided, and the management company. Some companies may also charge additional fees for leasing and maintenance services.
  • Can a property owner terminate a property management contract? Yes, a property owner can terminate a property management contract. However, the specific process and terms for termination will depend on the agreement between the property owner and the property management company. It’s essential to review the termination clauses in your contract and ensure that you follow the proper procedures to avoid any legal issues or penalties.


Weighing the pros and cons of hiring a property manager for your commercial real estate investment is an important decision that depends on your unique situation and needs. By considering the benefits, potential drawbacks, fees, and the process of hiring a property manager, you can make an informed decision about whether property management services are right for your investment property.

Remember to thoroughly research and interview prospective property managers to ensure you find the best fit for your commercial property and have a successful partnership.

And if you’re ready to start looking for a property management company, call us. Speed Commercial Real Estate always provides high quality property management services and valuable experience.

Renting Commercial Real Estate in Jackson, MS

sky-facing photo of a commercial building

When considering renting commercial real estate in Jackson, MS, multiple factors should be taken into account. To find the perfect space, it is essential to have a thorough understanding of the market and establish realistic expectations.

With much to consider when renting Jackson, MS commercial real estate, navigating the process can feel overwhelming at times. We hope to give you a variety of helpful tips and things to think about so that you can be as successful as possible in your search!

Tips for Finding Buildings for Rent in Jackson, MS

When you’re choosing a place to rent for your business, it’s important to think about every aspect of it— the good and the not-so-good. The following are some things to keep in mind:

Find the Right Location

Try to find a walkable location near public transportation if you plan to sell things like clothing or food.

If your customers are tourists or others who will be using their cars extensively, make sure there’s easy highway access nearby. You may also want to choose a location with ample parking, so customers can come in without worrying about where they’re going to park.

For office space in Jackson, MS, consider how easy it is for employees to get to work. Can they easily take public transportation or the highway? Do they have a safe place to park their car for 8 hours?

Research the Property Management Company and Building Owner

Owners of commercial spaces will often hire a property management company to handle things like rent collection, maintenance, lockout services, cleaning, and other everyday tasks. It’s important that you know how well these two parties work together.

For example, if a property management company doesn’t quickly handle maintenance requests, that could create an issue for your business. Or if the building owner doesn’t pay their mortgage on time, you could be at risk of losing your space.

Research the management company and owner online and talk to other tenants and neighbors. This will help you seek out the red flags and avoid getting into a situation that’s bad for business!

Check Local Zoning Laws

Local zoning laws may set limits for how you can operate your business. Do not assume that the building owner or property management company understands zoning laws.

A landlord may assume their building can be used for a certain type of business – say, a restaurant – only for you to realize that local zoning laws don’t allow it. Doing your own research will help you avoid legal confrontation with the local government.

Consider Lease Terms

When you find the perfect Jackson, MS commercial real estate building, it can be tempting to quickly sign the lease, so you can get all settled in. However, it’s important to carefully consider the terms of your lease.

  • What is the duration of the lease? A typical commercial real estate lease lasts for 5-10 years, but that might not be ideal for your business. A shorter lease with the option to renew at the end may give you greater flexibility.
  • What is included in the lease? Check to see if your rent includes any building-related expenses, taxes, insurance, and operating expenses that may increase over time. This will help you plan for expenses now and in the future.
  • Can you renovate the space? Depending on the type of business you operate, you may want to change changes to the building. Make sure you understand which changes you can make, who will pay for them, and who will own the products used when your lease ends.
  • What happens if you need to break the lease? Things happen in life and business that we can’t predict, and you may need to get out of your lease early. Be sure the terms of doing so are clearly defined, understand exactly what you will have to pay, and negotiate other options. For example, you may be able to break the lease without any penalties if you find someone to sublet the space to. If subletting is not included in the lease when it’s presented to you, ask for it to be added and negotiate the terms.
  • What kind of insurance do you need? Insurance is critical when it comes to buildings for rent in Jackson, MS. Your lease should clearly spell out which types of insurance are included (if any), what they cover, and who will pay for them. This also might mean you should have your property appraised, so you understand how much protection it needs.

In addition to understanding what you should consider when renting retail, restaurant, or office space in Jackson, MS, you can take advantage of some tools that will help make the search process easier.

Tools for Renting Jackson, MS Real Estate

These tools can help you find buildings for rent in Jackson, MS that fit your needs and budget.

Online Search Platforms

Building owners and property management companies often use commercial real estate portals to post vacant space. You can search by location, space size, building details, and more.

Real Estate Lawyers

Real estate lawyers who specialize in commercial properties are your best resource for understanding the terms of your lease. They will be able to read the fine print and ensure you aren’t taken advantage of. They can also negotiate terms in your best interest, so renting office space in Jackson, MS is a mutually beneficial agreement between yourself and the landlord.

Real Estate Agents and Brokers

Talk with your local commercial real estate agent about the things that are important to you. They’ll know what locations and features will attract the kind of business you want and will be able to help you navigate through the complex terms of commercial leases.

Try to find someone who has connections with other businesses in the area, too—they could give you some insight into what’s right for your market and how the location stacks up against its competition nearby.

Contact Speed Commercial Real Estate

Speed Commercial Real Estate is here to help you find commercial properties for rent in Jackson, MS, and make sure you get the best deal possible. We’ll help you set up meetings with owners and answer any questions you have about pricing or negotiating terms. Contact us when you’re ready to rent Jackson, MS commercial real estate space!


The Ultimate Guide to Small Retail Spaces for Rent

Finding a small retail space for rent is an exciting time for a business owner! Although it might feel like eCommerce reigns supreme, brick-and-mortar storefronts are incredibly valuable in the retail sector. Your storefront is your home base – a place where you can meet and connect with customers, host community-building events, allow customers to experience products before the purchase, and more.

There is much to consider when leasing a commercial space. For example, it’s important to understand how it will benefit your business, how much space you need, what kind of amenities you require, the type of community that surrounds the space, and certain legal implications.

Benefits of Leasing Small Retail Spaces

Whether you want to expand your online shop or you have an idea to start a business from scratch, utilizing retail space can be a huge advantage.

  1. Find work-life balance. Working from home and running an online shop has many advantages, but it can become overwhelming once business is booming. Suddenly, your garage is a storage room, your dining room is a packing center, and your office is filled to the brim with paperwork! Utilizing retail space in a neighborhood where your target audience lives will help you reclaim space in your home, allow you to enjoy spending time in your private space, and help you separate your work life from your home life.
  2. Generate more sales. Commercial retail space in a neighborhood with other small businesses allows you to take advantage of foot traffic, which means you have the opportunity to find new customers without doing any extra work! Also, you can talk to customers as they shop, explain the benefits of certain products, and recommend additional items – this makes it easier to double or triple sales.
  3. Create an experience for customers. Your website is a good way to introduce shoppers to your brand and give them a feel for what you stand for. However, a small retail space provides an all-encompassing experience that can draw customers back time and time again.

What Every Small Retail Space Needs

If you are interested in taking advantage of the above benefits, it might be time for you to start looking for retail space for rent! Let’s dive into what every small retail space needs to function properly.

Enough space

You can use this formula to determine how much space you’ll need to operate your business:

Gross sales volume ÷ sales per square foot = size of selling space

If you run an online store from home and you’re looking to transition to a brick-and-mortar location, you can add up the square footage of the spaces you use to operate your business. For example, that might mean the size of your garage plus the size of your office.

If you’re starting a retail business from scratch, it would be useful to browse comparable retail spaces in the area to get an idea of how much space you might need. It might be helpful to talk to some business owners while you’re at it! Most often, other entrepreneurs are happy to extend a helping hand – especially if you will be working in the same neighborhood. Community is important in the small business sector.


A retail space should make every customer’s shopping experience easy and pleasurable. Certain features like WiFi, adequate lighting, security features, and a spacious check-out area might be the first things that come to mind. However, it’s important to consider customers who have unique needs. For example, how easily can someone navigate a wheelchair or baby stroller through the front door? Are there bathrooms for employees and customer emergencies? Will there be enough room for a seating area for customers that have difficulty standing for long periods of time?

Aesthetic features

Aesthetics are very important for small businesses. Most likely, you’ll want your shop’s atmosphere to support your brand. When it comes to small retail spaces for rent, you have a few options here:

  • Rent a space that allows you to achieve your aesthetic goals through décor alone.
  • Make non-permanent changes (lighting, paint, etc.) to your leased space.
  • Perform renovations to create the ideal shopping experience.

These are important things to consider when finding commercial retail space for rent because the building owner may put restrictions on the types of changes you can make. Furthermore, the city may have its own rules as well.

For example, a landlord might have in the lease that you cannot make any major cosmetic changes, like replacing the flooring. And the city might have a rule that says you can’t paint the storefront certain colors.

A great location

Foot traffic is incredibly important for retail spaces, as is safety, type of clientele, and ease of access. Be sure to tour the area, whether alone or with a realtor, to assess the type of community you’re settling into. If you don’t live in the area, you don’t want to be surprised to find that you’ve opened up shop where there is no demand for what you’re selling!

Final Thoughts

If you’re looking for retail space for rent, keep in mind that some landlords may have specific needs when it comes to your store. It’s best to be prepared and know exactly what you need before beginning the search. Doing so will save you time and money as well as help you find a space that accommodates your needs.

Speed Commercial Real Estate is here to help you find the best space to operate your business in Jackson, MS. Not only will we locate the best commercial retail space for rent, but we will also help you understand leasing contracts, negotiate with building owners, and provide valuable information about the area. Contact us when you’re ready to find the perfect small retail space for rent!

2023 Commercial Real Estate Trends

For the last few years, it has felt as though the future of commercial real estate (CRE) investment is uncertain. In 2020, we saw the sale or lease of many office and retail spaces that transitioned to remote operations. Last year, we watched interest rates and inflation rates increase. And through it all there has been supply chain disruption that stalled the construction of new buildings and renovation of old ones.

However, in 2023, commercial real estate prices are expected to decline, strong job growth will likely put organizations and employees in better financial positions, and investment strategists project to see a decrease in inflation rates throughout the year.

The projected economic shift will change how commercial real estate investors manage their portfolios this year. To get a better idea of how the coming months will affect your investments, let’s look at 10 commercial real estate trends for 2023.

10 Commercial Real Estate Trends to Watch in 2023

Smaller properties with shorter leases are preferred

Many organizations that previously required multiple floors of office space have transitioned to remote or hybrid work structures. As such, they now need space that can meet their flexibility requirements.

Instead of tens of thousands of square feet for offices, conference rooms, break rooms, “bullpen” space, kitchens, waiting rooms, and more, tenants now seek just enough space for the necessities. Additionally, because flexibility is key, many organizations will prefer to rent from landlords that offer short-term leasing options

Cost-cutting technology

Although we expect to see a brighter financial future in commercial real estate, investors will continue to seek opportunities to cut costs. Technology that automates manual processes, controls building operations (HVAC, security features, etc.), and tracks spending/income will become non-negotiables in commercial real estate investments.

Prioritizing ESG considerations

Sustainability is at the forefront of our society, permeating all sectors of business. Savvy commercial real estate investors are making it a point to consider environmental, social, and governance (ESG) when purchasing, building, and operating properties.

According to PIGM survey data, an estimated two-thirds of CRE investors and fund managers have implemented ESG criteria into their investment strategies. PIGM expects that number to increase in the coming years.

Capital recycling

Rising interest rates and increasingly strict lending requirements have made it difficult for some investors to find financing opportunities. The H1 2022 Cap Rate Survey found that these CRE investors are concerned that tighter underwriting and lending assumptions will continue to stunt their portfolio growth.

As a result, capital recycling, or the process of using existing assets to fund new investments, has become more popular in the CRE investment industry. For investors without much liquid capital, this can be a good method of maximizing returns.

Repurposing malls

The decline of malls certainly is not a recent trend. However, it appears that CRE investors are beginning to get creative with these stagnant retail spaces housed in massive buildings. According to NAR’s 2021 Q1 survey, nearly 40% of respondents said that local malls are being repurposed into multi-use properties, including office, retail, and residential spaces.

Furthermore, a quarter of respondents said that malls would make suitable fulfillment centers or industrial spaces. As we continue to see an increase in online retail sales, especially from Amazon, cities throughout the United States will likely need these vacant malls to store goods, pack boxes, and ship orders.

The return of urban multifamily housing

During the pandemic, millions of people felt uneasy in crowded cities or simply didn’t need to live there anymore because their organizations transitioned to remote work. So, they flocked to the suburbs.

As companies return to work, public health concerns subside, and strong job growth persists, we see that workers have the desire to move back into urban areas. Investments in multifamily properties have been increasing by 56% year-over-year to reach $63 billion in Q1 of 2022, which is the strongest first quarter the sector has ever seen.

A rise in ghost kitchens

Ghost kitchens are facilities that prepare and deliver food with no intention of serving customers in-house. This was many restaurateurs’ answer to strict dining guidelines brought on by the pandemic – they can still make and serve food without the cost of hiring a staff, decorating and maintaining a restaurant, etc.

This allows commercial real estate investors to lease smaller buildings to restaurant owners because there is no need for a dining room.

More operational real estate

Operational real estate, like student housing, senior living facilities, and storage units, is growing in demand. Total CRE investing in operational real estate nearly doubled from 2020 to 2021, taking just over 12% of the Annual Global Investment Volume pie.

As a growing number of Americans need healthcare, student housing, and storage options, operational real estate will continue to be a popular and profitable sector.

A rise in digital economy properties

Digital technologies, such as cloud computing and storage, are in high demand. With businesses in every sector adopting such technologies en masse, there is a growing need for data centers that can house servers and networking equipment.

Although the current semiconductor shortage could impact the operations and new development of data centers, the United States is currently working to become a leader in microchip manufacturing. Plans to build semiconductor factories in Arizona, Ohio, and New York are already underway.

Prioritizing cybersecurity

Real estate investment transactions have always required significant due diligence before closing on an asset purchase or lease agreement, but cybersecurity concerns add another layer of complexity for investors looking to protect their interests going forward.

Kaspersky found that a cybersecurity breach cost enterprises an average of $1.4 million in 2021. While this is bad news for large corporations, small businesses can be completely devastated by such an attack. Investors must prioritize the use of best-in-class security standards to protect themselves, their tenants, and their portfolios.

Commercial Real Estate in Jackson, MS

As you can see, several changes that should make their way into the commercial real estate investing market over the next year. If you’re looking to sell or buy commercial property, it’ll be worth keeping an eye on these trends to understand how they might affect your business.

Speed Commercial Real Estate is here to help first-time commercial real estate investors navigate the coming changes in the industry. Contact Speed Commercial Real Estate if you are interested in investing in commercial real estate in the Jackson, MS area.


How To Buy Commercial Real Estate

Knowing how to buy commercial real estate opens your world up to incredible investment opportunities. Many people around the world, including Shark tank mogul Barbara Corcoran, attribute their high net worth to real estate investing. In Corcoran’s case, she grew her real estate agency into a multi-million-dollar empire, which began with $1,000 she secured with a loan.

Buying commercial real estate can be a tricky business. It involves a lot of research and negotiation and often requires professional advice from an expert consultant or attorney.

In this article, we’ll take a look at some of the things you need to know before you decide to buy commercial real estate in your area.

Reasons to Buy Commercial Real Estate

Before you learn how to buy commercial real estate, you should understand the benefits of doing so. This will help you find your motivation for buying, which can drive passion into your career.

There are many reasons why so many people choose to invest in commercial real estate:

  • The potential for high returns. Commercial property values tend to appreciate more quickly than residential property values, which means you can make more money as an investor.
  • The ability to diversify your investment portfolio. Investing in commercial real estate offers a way to diversify your investment portfolio with an asset that has different risks and rewards than stocks or bonds.
  • An alternative source of income. Commercial real estate investments can offer income from rents, leases, and other sources such as tenant improvements, leasing commissions, and management fees from property management companies.

Buying commercial real estate is a great way to provide for your family, achieve personal financial freedom, retire early, and leave a legacy behind for your family.

How to Buy Commercial Real Estate

After you understand your motivation behind commercial real estate investing, you can learn how to buy! Here are a few steps you can take to purchase the right property and see the best return:

Choose a Market

The five main commercial real estate markets are office buildings, retail spaces, industrial properties, multifamily housing, and hospitality.

  • Office buildings commonly have conference rooms, private spaces, and common areas so employees can interact with each other while they work on projects. There are small office buildings that can house one tenant or business, mid-sized buildings that can hold a few different tenants, and high-rise buildings that can host dozens of tenants at once.
  • Retail spaces are one of the most common types of commercial real estate investments because they can be bought in many different sizes and price ranges, from small mom-and-pop shops to large shopping malls with multiple tenants and lots of foot traffic.
  • Industrial properties include warehouses and manufacturing facilities.
  • Hospitality buildings host restaurants, entertainment centers, hotels, and short-term rentals (like Airbnb).

Get Pre-Approved for Financing

If you want to buy commercial real estate, it’s important to have a lender who knows your credit profile and has approved your loan application before you begin looking at properties. The lender will run a credit check and verify your income and assets to make sure you can afford a loan payment that’s larger than what you currently pay on your home mortgage. This will also let you know what you can afford to buy.

Find a Team of Real Estate Professionals

Finding the right team of real estate professionals involves balancing three factors: expertise, experience, and trustworthiness. You need to find people who are knowledgeable about the industry and can advise you on how to make an investment that will pay off. You also need people who have been in your shoes before — they know what mistakes to avoid, what pitfalls to avoid, and how to get through them if they do happen. Finally, you need people who are trustworthy — if something goes wrong with your investment, you want someone on your side who will go above and beyond for you.

Search for Investment Opportunities

Once you know what kind of building you want to buy, you know what you can afford, and you have a great team of real estate professionals behind you, it’s time to shop around! Search through online listing portals, the classifieds section of the newspaper, Craigslist, and Facebook Marketplace, and talk directly to property sellers.

Although these are all great methods for finding available commercial properties, your best bet will be to utilize your brokerage. Commercial real estate brokers have access to listings and data that you might not be able to find on your own. Additionally, they will listen to your unique needs and find a property that perfectly aligns with what you’re looking for.

Speed Commercial Real Estate Consultants

Speed Commercial Real Estate is here to help first-time commercial real estate investors navigate the tricky industry. We can make our best recommendations for properties, help you secure financing, assist with negotiations to get you the best deal, and even help you manage the property after you buy!

Contact Speed Commercial Real Estate if you are interested in investing in commercial real estate in the metro Jackson, MS area. We will stand firmly by your side to provide critical support.