Newport Beach is found along the coastline of Orange County, California. In 2010, it had a population of some 85,287 people. It is famous for Newport Harbor, which is a favorite of recreational boating enthusiasts. Newport Beach is a very rich community, with both property values and median family incomes ranking among the highest in the country. In fact, according to the Daily Pilot, a Costa Mesa newspaper that covers all of the Newport-Mesa area, at least 25% of households in Newport Beach earn $200,000 or more per year, and that property values have a median value of $1 million or more. This puts house prices in the city in the 8th rank in the entire country, according to a survey in 2009. And interesting piece of information is that Newport Beach is the most Republican city in the state.
Newport Beach Office Buildings for Sale & Lease – Should You Buy or Lease?
If you are interested in office buildings, you have two broad options available to you: buying or leasing. Before making a decision on which to choose, it is essential to look at the advantages and disadvantages.
Purchasing an office building has various benefits:
- Monthly expenses are predictable because monthly amortizations are fixed.
- There are several possible tax deductions, including property taxes and mortgage interest.
- You can rent out some of the office space, which could really help with your cash flow.
- You can build up substantial savings, because real property prices tend to go up over time.
Naturally, there are also a number of disadvantages when buying an office building:
- An office building is not a liquid asset. This means that it requires much more effort to convert it into cash when needed.
- You need to pay a down payment, which could make a large dent on your funds because this is usually around 30 percent of the total price.
- You will need to pay for maintenance, appraisal, and other property costs.
Your other option is to lease your office space, which also has clear benefits:
- It is possible to rent a prime office space, which can do wonders with your reputation.
- You need a lot less funds at the start because there is no need for a large down payment.
- You are not troubled by the usual problems that come with property ownership.
There are some downsides to leasing:
- Monthly costs will tend to go up. This is due to possible rent increases, depending on the lease contract.
- You do not accumulate any equity in the property, since you don’t own it.
Let us take a look at the trends and statistics in terms of prices, supply, and demand for office space in Newport Beach to help in decision making.
Newport Beach 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 spaces for sale in the metro area that includes Newport Beach 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 Newport Beach 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 Newport Beach 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 Newport Beach is 36, which is a 1.8% increase over the past three months, but a 19.5% decrease year-on-year.
Newport Beach Office Space for Lease – Trends and Statistics
- The average asking rent for office space for lease in Newport Beach expressed in dollar per square foot per year is $36.47, which is a 0.6% increase over the past three months, and a 17.2% increase year-on-year. This is higher than the metro ($25.41), county ($24.33), and state ($23.08) area.
- The index of total number of office spaces for lease in the metro area that includes Newport Beach 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 spaces for lease in the metro area that includes Newport Beach 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 spaces for lease in the metro area that includes Newport Beach is 58, which is a 3.7% decrease over the past three months, and a 12.4% decrease year-on-year.