Sunset Beach Commercial Real Estate for Sale & Lease

Sunset Beach is a community in Orange County at the California beachfront of Huntington Beach. It was established in 1905 and, when oil was found at the Huntington Beach Oil Field in 1920, it was quickly developed. According to the 2010 census, Sunset Beach had a population of 971 at that time. In 2011, it was annexed by Huntington Beach. The town is home to a number of popular bars and restaurants, with the most notable being Captain Jack’s, which was founded by Jack Haley Sr., famous surfer and father of Jack Haley, the basketball player.

In Sunset Beach, you will find one of southern California’s widest beaches. Parallel to this is the Green Belt, which is a 14 acre public park. Every year on Mother’s Day, the community gets together to celebrate the historic Sunset Beach Art Festival, with Las Damas as its sponsor. Surrounding Sunset Beach are various other beaches, including Bolsa Chica State Beach and the Naval Weapons Station Seal Beach, which has received National Wildlife Refuge status.

There is no residential mail delivery service in Sunset Beach. Rather, people must pick up their mail in private boxes on 22nd Street, or at the local post office. This post office has a mural created by Katy Brack that has won an award. The Huntington Beach Police Department protects the community, and the Sunset Beach Sanitary District serves it. This is a true community, where people help each other out. This is also seen in its community associations, including a woman’s philanthropic organization, Las Damas, the Sunset Beach Woman’s Club, and the SBCA (Sunset Beach Community Association).

Sunset Beach Commercial Buildings for Sale & Lease

Those who are interested in building on the economy of Sunset Beach have a number of options available to them. While options within Sunset Beach itself are limited, there is always the possibility of opening up something completely new. Property investors must look at finding commercial real estate (CRE) for sale. Those who want to run a business, however, can choose to either buy or lease. The official financial advice is to purchase a property if your business plan anticipates future needs of seven years or more. That said, even if that is the case with you, you may not be in a position to be able to make such a purchase.

When comparing Sunset Beach commercial buildings for sale & lease, you must consider more than simply the monthly amount you will spend on your regular payments. Both options have short term and long term pros and cons, significant associated costs, tax advantages and disadvantages, and more. Because of this, you have to take every element of both these options into consideration in order to find the solution that is most advantageous to you personally.

Sunset Beach Commercial Property for Sale

One place to start with comparing your options, whether you want to run a business or make an investment, is with trends in Sunset Beach commercial property for sale. As the community has been annexed to Huntington Beach, this means that their statistics are relevant to the town. As such:

  • Multifamily properties in the county usually cost around $314,841.90, which is a 0.7% rise compared to the last three months, and a year on year 10.5% rise.
  • Office properties in the county usually cost around $311.66 per square foot. This is a quarterly decline of 0.2%, although a 11.3% year on year rise. If you own office space, you can usually charge a yearly rent of $24.30 per square foot in Huntington Beach/Sunset Beach, which is a 2.4% increase over the past three months, but a 0.2%% decrease over the past year. Those prices are lower than the county and metro area, but higher than the state.
  • Industrial properties in the county usually cost around $222.13 per square foot, which equates to a quarterly rise of 2.7% and a year on year rise of 10.9%.
  • Retail properties usually cost around $408.88 per square foot, which has been stagnant over the past quarter. Year on year, however, this is a 14.5% rise. If you own retail property, you can usually charge $25.50 per year per square foot in Huntington Beach/Sunset Beach. This is a 2.2% decrease over the past three months, but a 1.7% increase over the past year. This price is higher than the state, county, and metro area.

Sunset Beach Commercial Property for Lease

In the vast majority of cases, business owners have no option but to purchase CRE. Because this type of property is specialized and generally quite large, it is also very expensive. And since you have to put down a 30% down payment in order to be considered for a mortgage, it is generally not within everybody’s reach. To enter a Sunset Beach commercial property for lease, however, you also have a lot of decisions to make, not in the least how you will find a property. To achieve this, you will need a broker and broker fees are generally paid for by the property owner. However, there are two different types of brokers to choose from, each with their own pros and cons.

First, there is the tenant broker. These brokers work to maintain your best interests above all else. However, they also want you to sign a representation agreement, which means that you can only see the properties that they actually have on their books. The second option is the leasing agent, whose main goal it is to represent the best interests of the landlord. However, you could have multiple leasing agents working for you, thereby seeing far more properties.

You should also get a lawyer on board, who can make sure that both you and the potential landlord are operating within the confines of the law. Furthermore, you need an accountant, who can make sure your financial interests are always maintained. Together with the broker, they can also negotiate the different elements of the lease contract itself.

Leasing contracts are very different from residential contracts, because the later is set in stone and cannot be negotiated on. Not everybody knows that leasing agreements are open for negotiation. In fact, landlords hope that you don’t know this and that you may consent to signing a contract that is heavily skewed in their favor. With a good team of professionals around you, however, you can negotiate on almost every element of the agreement, including:

  • The length and extent of your personal guarantee
  • How much you have to pay each month for the lease itself, and what that is based on
  • The type of lease that is most beneficial to you (percentage lease, net lease, triple net lease, or gross lease).
  • The duration of your lease and what happens when it comes to an end
  • The possible rent increases, what they are linked to, and how much they are capped at
  • Who will be in charge of maintenance
  • To what extent you are able to change the inside of the building and who will carry those renovation costs.
  • Whether you can signpost your store on the outside of the building
  • Whether you can sublease the space and, if so, under what conditions
  • What types of exit clauses are in place should you want to leave early
  • Your right to transfer your lease if you were to sell your business to a third party
  • Specific clauses such as exclusive use or co-tenancy
  • The amount of security deposit required

The Option of Purchasing a Commercial Property

What this demonstrates is the complexity of a lease. Naturally, you have the option of choosing to purchase instead, which brings with it some very different challenges, but also some very different opportunities. You have very few limitations in terms of how you choose to use a property if you decide to purchase it, other than having to stick to the zoning regulations. Zoning means that you can only run certain types of businesses in certain properties. The bigger issue, however, is that you will have to be able to put down a 30% down payment in the property if you are to get a mortgage.

This is a huge investment, but also a very strong one. Commercial real estate usually rides out economical unrest quite easily, because it is a strong economic driver. Furthermore, if you own property, you have the choice to operate out of it yourself, or to lease some, or all, of it out. Hence, you should be able to always have a degree of income protection by owning CRE. The price, however, is a significant disadvantage, and one that many struggle to overcome. You do, however, have the option of investing in a commercial real estate investment trust, or REIT. With a REIT, you never fully own a property, nor can you use it for your own business. On the other hand, you also don’t have to go through the hassle of being a landlord, and you can simply sit back and enjoy the benefits of a solid investment in the long run.