Wharehouse Units - Advise wanted

[vex]

I need some advise.

I have been in business for 18months and am now getting big enough to look at small industrial / warehouse units.

Looking for between 1000 and 2000 Sq Ft, looking around I have an option of renting (more available) or buying on a commercial mortgage.

Which is better for me and the business, I like the idea of buying as part of a pension scheme but I have no concept of how much say a £150,000 mortgage with a LTV of £125 / £130,000

Rent round here (Aylesbury, Hemel Hempstead) is between £6 and £10 a square foot.

What thoughts.

[srebbe64]

Personally, I own the properties which my company rents ftom me. I have an in-built reaction against paying rent - someone else's mortgage. Also, I haven't put it through a pension scheme because it's more commercially flexible to simply own it privately.

However, 'profit' should be your first concern.

[mutt k]

The answer to this depends upon your accounting strategy and tax position and appropriate professional advice should be taken. However, whereas a lease is a wasting asset, buying a building has historically provided an asset that appreciates in value, avoids the restrictions that are normally imposed by a lease, and can be used as security for borrowing or held in a pension fund.

A leased property on the other hand may provide more flexibility and requires less capital to be tied up.

[Davel]

Even though we own and rent out warehouse units, surely it is better to buy one yourself than pay rent for, say, 10 years and own nothing at the end of it.

[vex]

What costs and traps do I need to look out for.

Company is only 18months old, I had a quick look at commercial interest only mortgages but I can see an up hill battle being only 18month old.

Chris