case to ownership
Owning your office space makes sense. Here are a few reasons why:
Your suite will become part of your valuable portfolio; it is an asset that will pass to generations who will not likely have the opportunity to buy commercial space in this prestigious area. It is indeed a once-in-a-lifetime opportunity.
Paying down the principal builds equity for you. Renting offers no equity.
Stable long-term mortgage rates reduce cost and financial uncertainty, whereas leased space means unexpected rent increases and market uncertainty.
Unit owners have a say on the condo board which sets management fees, whereas a landlord can raise management fees any time.
Depreciation from an owned unit may be written off as operating and mortgage interest expenses. Leaseholders may only be able to write off the monthly lease as a business expense*.
Capital investments in the unit increases the value whereas improvements made to leased units only benefit the landlord.
The prestige of the area, coupled with the lack of available opportunity at present and in the future, means a rise in the value of your suite. Additionally, the steady increase of property values in Toronto along the Yonge Street corridor assures an outstanding ROI.
long term benefits
An owned unit is an investment that can be rented to a third party or sold. With a lease there are no real long term benefits.
*Purchasers are advised to get their own real estate, legal and tax advice.
Low interest rates in Canada are driving a new trend in Toronto and Vancouver — more business owners deciding to own their office space rather than lease it. BNN speaks to Scott Chandler, Senior Vice President, Advisory and Investment Sales at Colliers International, and Steve Gupta, President and Chief Executive Officer at The Gupta Group.