Commercial real estate — comprised of office space, hotels, retail space, industrial property, land and multi-family homes — is one of the three main types of real estate, along with residential and industrial. Owners of commercial real estate, say a gas station or strip mall, make money through appreciation when they sell, but they can also pull in revenue via rent they collect from tenants. (For more, download: Find Fortune in Commercial Real Estate.)


One of the biggest advantages of commercial real estate is the attractive leasing rates. In areas where the amount of new construction is either limited by land or law, commercial real estate can have impressive returns and considerable monthly cash flow.


Acquiring a commercial property typically requires more capital up front than acquiring a residential rental in the same area, so it’s often more difficult to get your foot in the door. Once you’ve acquired a commercial property, you can expect some large capital expenditures to follow. Your property might be humming along for a few months and wham, here comes the bill to address roofing repairs or a new boiler/furnace. With more customers there are more facilities to maintain and therefore more costs. What you hope is that the gains in revenue outweigh the gains in costs, to support purchasing a commercial property over a residential one.


Rules and regulations are the primary deterrent for most people wanting to invest in commercial real estate. The taxes, mechanics of purchase and maintenance responsibilities for commercial properties are buried in layers of legalese that shift according to state, county, industry, size, zoning and many other designations. Most investors in commercial real estate either have specialized knowledge or a payroll of people who do.



Research Is The Key to Success

Location

Finding the right investment location can only be done when all the facts and figures are in. Several areas need to be considered

Tenant Relationships

Small business owners generally will take more care of your investment as it is to their advantage.


Income potential

The best reason to invest in commercial over residential rentals is the earning potential can be higher but guanteed.


Good Access

Find a building with good road access to hihgways and good parking.



Average Rental

Checking rental prices will give you insight as to how much to spend on your investment in your chosen areas.

Risk Assesment

Taking notes of the down sides of the area like crime, flood risk etc, will arm you with the knowlege of risk to your investment.

Having a Selection of Investment

By having a good selection of potential investments will make life much easier than just the odd one or two.

8 Bedrooms 9 Full Baths. $5,295,000.

10 Bedrooms 13 Full Baths $10,750,000.

Los Vegas 5 Bedroom . £244,900. .

Phenix 5 beds 3 baths. $ 340,000 .

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