Not every business owner needs to purchase real estate for their workspace. Many successful businesses operate out of a leased property without ever owning it.
This does not mean one option is better than the other. If you own a business, you will have significant liabilities no matter what. You must decide where to invest your capital and where to save in the short term.
Buying commercial property
Owning real estate might increase your business’s value over time, even if it does not grow significantly. Also, owning property means you have more equity to work with. Companies that purchase their commercial real estate tend to expand much faster because of the increased capital they have access to. However, commercial real estate purchases are long-term investments that might take years to pay off.
Leasing commercial property
Leasing a commercial property is usually a much less risky investment. Though you might spend more money over a long period, you will save money that you can allocate to other assets in the short term. Not only that, but you can deduct your monthly payments and pay less in taxes. Utah already has a low tax rate of 5 percent, so intelligent businesses might avoid paying significant taxes.
Buying or leasing property will depend on your specific business structure. This is not advice on what method is superior. Please look at your finances and determine what makes sense for your company and how you want to grow it. It might make sense to lease at first and save up capital to purchase commercial real estate.