Commercial real estate investment options

When creating an investment portfolio, businesses should consider a wide variety of investment options.One of those options is commercial real estate.Commercial real estate can be an excellent way to boost a portfolio and add net worth to a company.Many types of commercial real estate exist.Here is an overview of a few of the different types of commercial real estate that companies may consider investing in.

Office Properties

Office properties are buildings with separate office space available for lease.Companies may consider investing in this type of property for a number of reasons.Office properties have the potential to bring instant income.This is because the businesses that operate inside each office are going to be leasing the space.Also, companies will not have to worry about a huge mortgage payment or utilities.If they play their cards right, the money they receive through leases may even cover the property tax due on the property.The one drawback is that the investor must find a way to keep all of the units full in order to maximize their investment.

Retail Properties

Retail properties would be locations where businesses would be able to sell products to customers.These properties usually come in the form of strip malls, but can also be a wide variety of other types of buildings.The same benefits apply to investors when it comes to instant income because each business will be leasing their space.However, investors should be sure that their property is in a good location to attract customers.If the building is in a good location then the investor will have an easier time attracting businesses to lease the property.Also, the investor may be able to demand a higher lease depending on the location.

Industrial Properties

Industrial properties are locations where companies can set up for manufacturing or warehousing products.These locations must be accessible to large trucks that will be delivering parts to the plant and taking finished products from the plant.These properties can also be leased, or an investor may purchase the building for their own purposes.With this investment, the company stands to increase their net worth and build equity.

Multi-family Properties

Multi-family properties are also considered commercial properties.Just like leasing office space or retail space, multi-family properties also bring the opportunity for instant profits as the tenants would be paying rent.Investors will need to keep the property full, but if they have purchased a property in a good location, finding tenants will not be a huge problem.

No matter what type of commercial property a company chooses to invest in, they will need a large amount of cash on hand in order to secure a loan.Commercial properties require large amounts of money down, and sometimes companies must prove that they have enough cash in the bank to pay the entire mortgage for an entire year.Make sure to research lenders to find the best deal.

When investing, companies have many options in the realm of commercial property.Investors will be able to choose between office and retail properties, along with industrial and multi-family properties.Companies may choose to invest in a variety of properties or specialize in a certain type.No matter their investment, investors should be sure to find properties in excellent locations or be willing to invest in the area surrounding an investment to ensure that they can find tenants and build equity.