Buy Or Build A Commercial Project?

Buying Property Where to Buy
#1

Salam everybody. Basically i'm an investor & by profession i'm a doctor.

1- with a budget of 1 to 3 crore i'm interested to invest money in a commercial space/building which has a higher incoming rent. My preferences of such buildings are (a) hospital (b) petrol pump (c) commercial plaza etc. Please do inform me if you have knowledge of such property in the mentioned budget.

2- my preferences for area of investment are (a) allama iqbal town (b) sabzazar scheme (c) gulberg (d) dha (e) bahria town (h) mall road etc. Which area do you suggest to be a best fit for me? What other areas do you suggest?

3- last question... In order to achieve a best fit of investment what is the best option for me? Should i build a prohect or directly buy & modify or convert it to my desired building? Please give your honest suggestions & also inform me about such properties in lahore. Thanks & regards Dr. Noor

#2

Hi Noor,

The budget seems a little on the lower side for a hospital but you sure can get a commercial plaza (4-8 marla) in DHA Lahore which also generate some of the highest rents.

Both DHA and Gulberg attract businesses since they are both commercial hubs and prime locations in the city. Both Sabzazar and Allama Iqbal Town are a bit far off from the main city. Bahria Town is too. If I were you, I won't consider any area other than DHA per se.

You should buy and modify your desired building. Constructing is bit of a hassle for a salaried person who cannot take time off from work every now and then. Besides why construct when you can get all kinds of buildings?

Available commercial plazas in DHA Lahore.

Best of luck.

#3

Since, you are a doctor, you should go for a hospital. And if you do not find a good building, then buy a land and build hospital on it.

benefits: 1) it would be a social service

2) You will have your own hospital or precisely your own business

3) You will be working in your field of expertise.

I am going to note down your requirement of such a property. I will let you know in case I find any reasonable option. Regards, z@in N@deem

#4

I second Nafees suggestion. DHA is the best place to look for an option. There are quite a few vacant plots in older phases (1 -4) on a comparatively cheaper rate. They are fully populated and as u know the population drives the commercial estate.

Phase 5 - 8 have better and modern infrastructure (U/G Electric/Gas lines) though but they will be expensive too.

Generally, people earn more in trading of commercial plots than actually building and renting it. Additionally, you'll be paying regular taxes on rental income.

This is not a healthy trend but this is how the market has been behaving. The investors repeat the cycle of buying and selling of the plots without actually putting them to a use and as a result the prices keep climbing.

Goodluck!

#5

AOA, There are a lot of problems in Pakistan which we all face :). If you go for petrol pump, you have to choose the place wisely, spacious, rushy area would be fruitful. As our petrol prices are increasing day by day, you may face problems like Hardtaal or protest shutdown.

As for hospital, it can also become a very handy investment but my personal opinion, there is a lot of tensions involved like maintenance, security, medicines, patients care, highly qualified doctors etc.

Commercial plaza according to me is the safest and most profitable investment. You can select a place according to your target market and medium rushy area. You can give the shops on rent and by sitting at home you can earn back your investment sooner.

These are my personal opinions so I shared it with you.

Best Regards, Shehryar

#6

Hi, What about building a small commercial plaza of 7-10 marla and then selling the shops individually is this profitable?

#7

Ali for me building a commercial Plaza and renting the shops is the best option.

#8

Why do you say that? Is it not better to sell the shops, make 50% profit on your investment and then repeat?

#9

Ali your point is also valid but think in this way buying or investing in a plaza and then having monthly rent from multiple shops, you can earn high return on investment and also you don’t have to search for different places for high value commercial building again and again.

#10

Agree with shehryar saab here. The question you need to ask is whether you want to build a plaza and then divide the shops yourself. Or whether you want to buy a fully built existing plaza. The only thing is you need a lot of money to build the plaza in the first place or even to buy one. The investment itself is pretty good though.

#11

Thank you Sheikh Abdul for agreeing to my opinion.

#12

Thanks for the replies. I would also prefer to get regular rental income as it is less risky. But my concern is having a lot of money tied up in the commercial property as it is a huge investment.

What I actually thought of doing is building a plaza of say 5 storeys. Of which 3 storeys are shops and the upper 2 is apartments/offices.

I would then sell the majority of the shops and recoup my investment and break even. The rest of the shops/apartments/offices I would then rent out for a regular income.

What is your thoughts on this?

#13

Dr Noor, it depends how you want your life to be, if you want to relax and don’t want to work and just getting the rents of the shops then plaza would be good. But if you want to stay in touch with your profession (doctor) and will continue to work and help the humanity then Hospital would be a better choice. I would recommend you a Hospital, wait for a while until you save more for Hospital. You are a doctor and you will know how to run the Hospital and deal with patients/clients because of experience. If you go for Plaza or commercial building, it could go in a wrong direction (God forbid), because of no experience until unless someone can help you with sincerity, but in today’s world no one helps free.

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