Increasing the Value of Investments

Lucrative returns in the Norwegian commercial real estate market are possible. One of the best ways of reaching this goal is to increase the value of your investments. Here are three good ways of reaching this goal.

Purchase Properties That Are Undervalued

If you keep your eyes open, you’ll occasionally find commercial real estate that can be purchased for much less than it’s fair market value. There are many reasons the seller of a Norwegian commercial property might sell for less than the property is worth:

· Financial problems

· Difficulties with an existing partnership

· Lack of market knowledge

· Lack of desire to own real estate

· Inability to properly manage cash flow

· Uncertainty about how to increase property value

Make Improvements

Another method of increasing the value of a Norwegian commercial real estate investment is by improving the condition of the property. Whether a large apartment building, a retail establishment or any number of other commercial real estate concerns, one of the fastest ways of increasing asset value is by making investments in remodeling and other upgrades.

Determining the best repairs and modifications to make can sometimes be challenging. If you’re not familiar with how to go about increasing the value of your Norwegian commercial real estate investments, it’s important that you find a local market expert who can help. Remember, all improvements are not equal. Some improvements, such as carpet, paint and other superficial improvements, can increase the value of a commercial property on a dollar-for-dollar basis; others – like roof replacements/repairs – don’t have the same impact on the value of an asset. (Keep in mind, though, that fixing a leaky roof is necessary, even if it doesn’t increase the value of the asset.)

Increase Rents – Unearned

Another way of increasing the value of your commercial real estate investments in Norway is to increase the rents. The reason? The value of commercial real estate investments is directly tied to its net income. On paper, increasing the rents charged to your tenants by 10% could conceivably increase the value of your investment by at least 10% -- assuming of course there is no corresponding increase in expenses. By marshaling in higher rents on an annual or bi-annual basis, you could systematically increase the value of your commercial real estate holdings in Norway quickly and easily.

A Second Way to Increase Rents on Your Norwegian Commercial Real Estate

Periodic rent increases are an effective means of increasing asset value. An often-overlooked first cousin to this strategy is to utilize the first two methods: Undervalued property purchases and making improvements.

The reason these methods of increasing asset value are so effective is because, by themselves, they lend themselves to automatic rent increases (assuming your leases are structured in a way that will allow this to take place). Because improvements can make a property more visually appealing, you should also find that potential tenants will be willing to pay higher rents, thereby increasing the value of the asset.

These are just a few ways of increasing the value of our commercial real estate investments in Norway. There are many more. By turning to a good commercial real estate business partner in the Oslo area, you’ll be able to learn all the little details that make reaping the financial rewards much more attainable!

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