Feature of the Month

Recent souring of real estate and other markets left many feeling that their businesses or personal real estate may be a liability. Natural disasters have also changed normal real estate activities in a number of regions. Both occurrences have placed real estate on the “repurposing” list and changed the way we think about business and personal property.

There are many scenarios in which your real estate may not be serving you as well as it could. Perhaps your warehouse is larger than currently needed by your business so you are heating or cooling wasted space. Maybe your store has cut back on the stock it carries and the shelves are looking a bit bare. It might be that you purchased a house with four baths and you really use just one. Any of these situations call for creative use of space.

Before implementing any changes in the use of your property, address insurance costs and zoning regulations to avoid unpleasant penalties. Each county develops its own ordinances so begin your research at your county’s website or courthouse. Zoning commissions are becoming more realistic and realize the benefits of a stable tax base.

Here are some ideas for repurposing or changing the use of your real estate to raise capital without selling:

• Lease a portion of your store or business to bring in a compatible but not competing product.
• Subdivide your warehouse and lease to other companies who may not have capital to purchase their own warehouse.
• Create executive suites in underused space in your office building. This is appealing to owners of home-based businesses.
• Consider acquiring a housemate or divide you home to create a duplex.
• If your large home is appropriate and zoning allows it, consider creating a Bed and Breakfast.
• Rent out your home if you are undecided about selling.
• Move your small business into a portion of your home.
• Time share all or portions of your business space
• Provide additional services, such as repair service, to customers to utilize wasted store space and to keep customers loyal during buying shortfalls.

Following, you will find links providing information about the above ideas and more.

• Illinois workNet guides to starting a small business and where to go for help
• How zoning affects property usage
• Free re-zoning advice
• Reasons new business will want to lease
• Sharing business space
• IRS tax guidelines for using your home for business purpose
• Home based businesses
• Using your property as a Bread & Breakfast Inn (B & B)
• Business plan for starting a B & B (.pdf)
• Renting your residential property
• Renting a room in your residence
• Ten ideas provided by a successful real estate broker for using a residential property to raise cash