Lake Forest is a particularly beautiful part of California’s Orange County. According to the 2010 U.S. Census, it had a population of 77,264. The city was quite late to incorporate, which took place on December 20, 1991, when it became known as Lake Forest instead of El Toro. It now also includes the two master planned developments of Portola Hills and Foothill Ranch. This increased the number of homes in the city, and also the number of commercial cities. Interestingly, Lake Forest has been declared to be one of this country’s safest cities.
Lake Forest gets its name from the two man-made lakes, which also serve as community gathering places. Both lakes are maintained by community associations. The forest it gets is name from is also man-made, being a eucalyptus grove that was built to boost development at the start of the 20th century.
Lake Forest Office Buildings for Sale & Lease – Should You Buy or Lease?
If you are interested in office buildings in Lake Forest, whether as an investment or as a place to run your business out of, you have two choices: buy or lease. There are both advantages and disadvantages in buying and leasing so let’s take a look.
Looking first at buying office space, there are a number of benefits:
- Your costs are fixed, particularly because the monthly amortizations are constant.
- There are a number of possible tax deductions, including property taxes and mortgage interest.
- You can have part of the office space offered for lease, which could provide some steady income.
- You can build up savings, the price of office buildings are expected to increase over time.
Now, let us take a look at the cons of buying office space:
- An office building is not a liquid asset. What this means is that you can easily convert it to cash in the event that you want to close shop or move to another location.
- Your initial costs would be quite large because you need to pay a down payment, which is about 30 percent of the total price.
- You will also have maintenance, appraisal, and other property costs to pay.
If you lease the office space instead, there are some advantages:
- You can get a prime property, which is important if your public image matters.
- You can free up some working capital because you don’t have to pay for a down payment.
- You don’t have to concern yourself with the usual problems that accompany property ownership.
Now for the disadvantages of leasing office space:
- Your costs will likely go up over time, as a result of rent increases.
- You do not build up any equity in the property, since you don’t own it.
Let us now examine the trends and statistics in terms of prices, supply, and demand for office buildings in Lake Forest to help decide whether to buy or lease.
Lake Forest Office Space for Sale – Trends and Statistics
- The average office property asking price, sale trends, in dollars per square foot for the county was $311.66, a three month decrease of 0.2%, but year-on-year increase of 11.3%. This is lower than the metro area ($317.28), but higher than the state ($226.32).
- The index of total available office space for sale in the metro area that includes Lake Forest is 34, which is a 6% increase over the past three months, but a 3.7% decrease year-on-year.
- The index of total number of listings of office properties for sale in the metro area that includes Lake Forest is 35, which is a 5.5% increase over the past three months, but an 8.4% decrease year-on-year.
- The profile view index for office properties for sale in the metro area that includes Lake Forest is 138, which is a 19% increase over the past three months, and a 14.5% increase year-on-year.
- The index of total square feet of available office properties for sale in the metro area that includes Lake Forest is 36, which is a 1.8% increase over the past three months, but a 19.5% decrease year-on-year.
Lake Forest Office Space for Lease – Trends and Statistics
- The average asking rent for office space for lease in Lake Forest expressed in dollar per square foot per year is $21.22, which is a 1.2% decrease over the past three months, but an 8.2% increase year-on-year. This is lower than the metro ($25.41), county ($24.33), and state ($23.08) area.
- The index of total number of office space for lease in the metro area that includes Lake Forest is 61, which is a 1% increase over the past three months, and a 3.1% increase year-on-year.
- The profile view index for office space for lease in the metro area that includes Lake Forest is 115, which is a 49.7% decrease over the past three months, and a 28.4% decrease year-on-year.
- The index of total square feet available for office space for lease in the metro area that includes Lake Forest is 58, which is a 3.7% decrease over the past three months, and a 12.4% decrease year-on-year.