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Leasing Vs. Buying Office Space

Should you continue leasing or buy a building?
September 1, 2006

Entrepreneur magazine, January 1998

Your lease is up for renewal. Should you sign a new one, or is it time to buy your own building? Kale Gaston, southeast regional vice president of GE Capital Small Business Finance in St. Louis, offers these tips for making this important decision:

Gaston says a small business typically begins to consider buying real estate when it is about 5 years old. "In the start-up stage, [businesses] need to be putting their equity contribution and loan money into growing the business," he says. "After they've leased for a while, and they're growing and need more space, they'll buy a piece of real estate and build an investment for the future rather than [paying increased] rent."

Jacquelyn Lynn is a business writer in Winter Park, Florida.