Building owners achieve economies of scale through stringent maintenance and well planned upgrades.
The long reaching arm of the current economic downturn requires innovative thinking when it comes to commercial and industrial property ownership and management. New construction has slowed down considerably during 2010, thereby causing enormous budget implications for commercial and industrial developers. In an effort to counteract these external forces, many industry leaders are evaluating building refurbishment and upgrade as a viable means to increase property values and rental incomes in the absence of new building construction.
Building refurbishment encompasses many construction components to improve the overall look and efficiency of a given space. Areas often evaluated by industrial and commercial developers when deciding whether to refurbish a building include structural soundness, exterior building finishes, insulation and energy efficiency, landscaping, and flooring components. Any of these areas showing degradation in appearance due to aging that has occurred over time offer the opportunity for cost effective improvements that provide a dramatic economic return on investment.
Paul Scotch, president and owner of ScotchBuilt Inc., a Northeast Pennsylvania general contracting firm, has seen an increase in his own business specifically related to building refurbishment projects.
Explains Scotch, “I have been contracting for everything from steel retrofitting to installing new building skins, insulation, and fencing. These building improvements enhance the overall look of the building’s exterior. From a marketing perspective, this leads to an increased viability that a potential rental client will come to look at a building. With the limited market we are dealing in today, new leads such as this are priceless.”
Scotch continues, “In addition to exterior refurbishment driving potential clients through the door, improvements in the building’s insulation provide greater energy efficiency for tenants of commercial and industrial rental properties. Lower energy costs are a powerful selling point, particularly when dealing with the large square footage of an industrial space.”
In looking at the future economics of commercial and industrial building, market trends are indicating little to no uptick in rental and sales activity at the present time. These conditions will drive innovative commercial and industrial developers to refine their business approach to increase revenues.
As summed up by Scotch, “Refurbishing an existing building is simply the easiest way for a developer to recognize an immediate return on their investment. It creates a win-win for both the tenant and building owner. The tenant occupies an energy efficient and attractive business location and the building owner increases their property value and the feasibility of rental income. Refurbishment is a proven business strategy that works.”
ScotchBuilt is a second-generation family owned General Contracting business. Whether building a retail unit, large scale warehousing, a medical complex or a multitenant office building, ScotchBuilt is flexible enough to adapt to their clients needs. With projects ranging from 5,000 square feet to over 200,000 square feet, no project is too big or too small. Visit www.scotchbuilt.com for more information or call 570-689-4303.