Hits And Misses

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Like life itself, most things we do are progressive in nature. Real estate investments too start in residential properties and then move up to reaping the benefits of investing in commercial properties. 

We've put together an express guide pointing out the pros and cons of investing in commercial real estate, just in case you may be toying with the idea. 

What Qualifies As Commercial Real Estate?

- Retail Shops and buildings. 

- Office buildings
- Industrial Buildings
- Warehouses and,
- Mixed-use buildings which house a variety of uses such as homes, retail or office space.

Commercial Property Investment 🔼

1️⃣ Commercial properties come with higher price tags but higher rents as well, meaning higher potential returns. Instead of making a profit of a few thousands on a residential property, there is a possibility of netting lacs on a commercial lease. 

2️⃣ Commercial leases will typically run from one to 10 years. This provides you with peace of mind in knowing you will have stable cash flow for a prolonged period.

3️⃣ Commercial real estate is a sensible way to diversify your portfolio. The pandemic has taught us that not all real estate is created equal. Where your local pub and movie theatre might have struggled, your local pharmacist or grocer could have seen remarkable success. 

Commercial Property Investment 🔽

1️⃣ Most commercial tenants operate their business during typical working hours and on all days of the week. This means evenings on weekdays/ends are when you work to conduct any maintenance at the property. 

2️⃣ Commercial properties have more public visitors, creating more opportunity for damage to be done to your property. And you know the kind of stuff that goes down in parking lots. 

3️⃣ Commercial real estate comes with an extremely specific range of needs and you cannot do without expensive experts - the kind folks who handle maintenance and administrative tasks. This can cut into monthly cash flow and is difficult to do on one’s own too. 

Looking for recommendations? 

Make friends with someone who is invested in commercial real estate and by the time you have done a few cups of chai together, you'll know which way to go.