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The Pros & Cons of Build to Suit Construction

//The Pros & Cons of Build to Suit Construction

The Pros & Cons of Build to Suit Construction

Build-to-suit buildings are typically long-term investments that can be leased to numerous tenants or provide current tenants room for future expansions. To help facilitate between the landlord and tenants, Toebben Construction in Greater Cincinnati and Northern Kentucky can help design a build-to-suit property to meet all of the tenant’s needs and goals.

Build-to-suit developments can offer many advantages to the tenant, including the following:

  • Build-to-suit developments allow the tenant an opportunity to input ideas and goals into the design of the building.
  • The development allows for the most efficient use of the interior space because it is built to the tenant’s specific needs.
  • A build-to-suit property allows the tenants to chose their ideal location rather than having to wait for properties to become available.
  • Since build-to-suit developments are newly constructed, they are typically equipped with the latest technology and the most energy efficient construction materials, reducing the operating costs for the tenant.
  • Build-to-suit locations typically have space that can be leased to other tenants or reserved for future expansions.
  • Because tenants can customize the property, the company can incorporate their individual brand into the exterior or interior designs of the space.
  • The rent for build-to-suit properties is fully tax deductible over the full term of the lease.

Like every important company decision, build-to-suit properties do have some disadvantages that must be considered, as listed below:

  • Build-to-suit properties usually require a long-term commitment. Most contracts are at least a 10-year lease.
  • Since build-to-suit properties are more expensive, they require excellent credit to gain financing.
  • Build-to-suit developments can take several years to finish.
  • Due to the extended time and money commitments, tenants should ensure the property would meet most of the company’s long-term needs.

Build-to-Suit Development

If you choose to pursue a build-to-suit development, it is important to know your company’s long-term goals and needs. Ensure that the location, design, and construction materials will benefit your company now, as well as in the future. Also, make sure to include flexibility into your plans to allow for expansion and growth. It is equally important to know your developers. To warrant a smooth process, be sure to choose a developer that can serve as a point of contact throughout the project. It is also important to find a developer that has experience building industrial properties with the expertise and skills to get the job done. With over 60 years of experience in the commercial construction industry, Toebben Construction in Greater Cincinnati and Northern Kentucky can provide the expertise to create the perfect build-to-suit space for your company!

2018-03-29T15:47:33+00:00