Fair price for workshop space

[Sloth in a bowl]

There is a workshop that may be available to me to purchase and though I can't afford it alone, if I sub-let out some of the space then I may be able to cover the bills.

 

To add a bit of location perspective, this building is in Birmingham with the nearest motorway access of the M5 junction 1, and sits within a gated secure area of residential garages. The location makes it unsuited for commercial use which is why I may be able to bargain a cheap purchase cost.

 

If the general fair price is high enough to cover the majority of bills (mortgage interest, electricity, water, rates, maintenance) then I am willing to look in detail at purchasing it and improving the facilities over time for users.

 

The start up cost for me (deposit, legal fees, create decent external hard standing, basic tidy up) will be in the order of £12,000 to £13,000, so you can see that I am being serious and realistic over the potential financial risk to myself.

 

So what is a fair cost per month for:

1)  Access to a workshop with alarm system, water, power, lighting, toilet, basic heating and inspection pit (intend to get some form of low lift in the future as the roof has not got the height for a full lift)

 

2) Option 1 plus internal dry storage for 1 car  (I think there would be room for 4 cars)

 

3) Option 1 plus external hard standing storage for 1 car with the intent to add open sided car ports for protection (I think there would be room for 4 to 6 cars)

[minolman]

Fair cost will only be able to be established by you if you look at the unit cost for option 1 to yourself of the costs involved as you say, mortgage interest, utilities used, rates, a maintenance figure, divided by the number of places you have for vehicles, or the square footage. This will give you a total cost of the outgoings.

 

Added to that will of course be your own costs / profit margin. If this figure sounds attractive enough you will soon know! 

 

These also vary regionally of course. Sounds an interesting project. Good luck with it

[Bobthebeard]

I would seriously look again at your start up costs. Not that I know anything about your prospective purchase!

Just have a serious look and a re think. In my experience the cost goes up by 50% with the unexpected and extra stuff that goes with this kind of venture.

IMHO obviously.

[catsinthewelder]

How would you arrange access to the workshop area?

 

It strikes me as a good idea that could potentially go tits up when somebody puts their car on the pit for a service and leaves it there for six months because they snapped off a bolt and couldn't get a replacement that day or something similar.

[Sloth in a bowl]

Initial costs are assumed at:

£8,000 mortgage deposit

£1,000 legal

£1,000 material for hard standing area

£500 fencing

£1,500 to £2,500 fixing leaks, water, etc

I can afford more, but really do not want to, even this is £5000 more than I would like but I can accept that these things have a large minimum start up cost.

 

Fair cost to me, means covering about £5000 per year of running costs assuming:

£2300 mortgage interest

£1400 rates (though this should be lower and may even be free to start with)

£300 water

£500 insurance

£500 electricity

 

This means getting a minimum income of

4 x internal cars at £60 per month => £2880

6 x external cars at £30 per month => £2160

I would be charging myself at the same effective rate as everybody else as any space I use won't be bringing in income.

If I can get 10 to 20% more per car then the workshop would get new kit at a decent rate.

 

That's why I'm interested in what a 'fair' rate is that people pay for workshop space anywhere round the country.

[Sloth in a bowl]

How would you arrange access to the workshop area?

 

It strikes me as a good idea that could potentially go tits up when somebody puts their car on the pit for a service and leaves it there for six months because they snapped off a bolt and couldn't get a replacement that day or something similar.

 

The property has about 700 sq ft of working space plus storage upstairs.

I'm taking the view that a bit of online organisation and planning will allow people to make the best use of the time and space available (along with a few car dollies)

 

Maybe I'm being optimistic 

[Bobthebeard]

If you can 'afford more' and are dedicated then you will probably be fine. Relying on cars being stored is an imponderable and up to you getting the custom. All depends on how dedicated you are and whether you are any good at business. I am hopeless, so have learned my lesson!