How to Buy a Commercial Property in Ontario

If you're an investor looking for a sound investment, or if you're a business owner looking to invest the money you would normally spend on a lease, then buying a commercial property in Ontario can offer a viable business opportunity. Before you buy a commercial property in Ontario, it's essential to understand that you'll not only need an accurate estimate of the costs and benefits, as well as the potential return on investment, but also the assistance and advice of qualified real estate professionals who understand the commercial real estate market in the area. Read the following steps to find out how to buy a commercial property in Ontario.


  1. Image titled Buy a Commercial Property in Ontario Step 1
    Determine whether you want to buy a commercial property in Ontario to conduct your own business operations or to lease to another party.
    • If you're going to use the property for your own business operations, you'll need to find a property that meets all of your business's demands pertaining to location and accessibility, amenities, and commercial zoning.
    • If you want to lease the property to another business, possible types of property include those that are appropriate for office, retail, or industrial use. Each type of property will attract a specific type of business and require a specific kind of investment and management.
  2. Image titled Buy a Commercial Property in Ontario Step 2
    Investigate the benefits and risks of buying a commercial property in Ontario. It's best to assemble a team of experts to assist you with this, including an accountant, lawyer, mortgage broker, and a licensed realtor.
    • When buying a commercial property in Ontario for your own operations, benefits can be that you'll gain more returns on your investment than you would from leasing, and you can claim property depreciation as a deductible when you file taxes. In addition, real estate is a sound asset that adds to your company's equity.
    • A risk can be that the returns aren't as good as projected. Whether you're leasing the property to another business or looking to re-sell it after a period of time, it's important to understand that tenants may not always pay on time, and re-selling can be problematic if the market's experiencing a slump. Other risks to consider are loss of liquidity, meaning that your business's finances will to a certain extent be tied up in the property, and that the property's location may become less attractive over time due to infrastructural changes or devaluation of areas.
    • Make sure to work with a realtor who's licensed by the Ontario Real Estate Association, which represents real estate brokers who are all members of Ontario's 42 real estate boards. The Ontario Real Estate Association strives to promote the highest possible standards for the industry, so you can be sure to find a trustworthy realtor.
  3. Image titled Buy a Commercial Property in Ontario Step 3
    See how much you qualify for by visiting a bank. Once you know the amount you can borrow, you'll be able to narrow your search to commercial property that fits in your price range.
  4. Image titled Buy a Commercial Property in Ontario Step 4
    Select a commercial real estate property in Ontario. Make sure it meets all of your demands in terms of location, accessibility, condition of the property, commercial uses, and reselling value.
    • It's also a good idea to check local development plans to see how current and future plans will impact the value of the property, and to do a title search to make sure there isn't a lien on the property due to a previous owner's payment defaults.
  5. Image titled Buy a Commercial Property in Ontario Step 5
    Review the sales contract with your realtor and lawyer. The realtor has some legal training and can help get the contract (also called an Agreement of Purchase and Sale) ready to take to a lawyer.

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Categories: Buying Property