Planning To Invest In Commercial Real Estate? Know Its Benefits First!

By Akshay Sharma July 13, 2017 Properties

Commercial redevelopment represents a path to build massive and passive wealth. For many investors, it offers several advantages over residential investments, like – higher income potential, steady cash flow, more attractive leasing contracts and lower vacancy risks. However, these investments aren’t without obstacles. As they offer substantial upside, these complex undertakings require investors to do their due diligence when seeking deals, like – understanding the ins and outs of how it works.

What is a commercial property?

Commercial investments usually consist of purchasing the properties solely for business purposes and then leasing the space in order to collect rent from each business occupying the space. These properties are commonly termed as retail, office, industrial and apartment building, mixed-use buildings, and warehouses.

Before investing in commercial real estate, know the market research about regarding it and benefits too. Investing in real estate can be rewarding, both personally and financially. The objective for most of the investors is future wealth and security, and others utilize it for tax benefits and increased diversity of investments.

There are many benefits of investing in commercial real estate, which is mentioned below:

Greater revenue: An important aspect of investing in commercial real estate is getting high revenue. These kinds of properties have a better return on investment, which is six to twelve percent. Single family home properties fetch one to four percent only. Commercial real estate also provides lower vacancy risk as these properties are spread over several units. Also, the lease contracts of these properties are longer than the residential real estate.
Consistent income: Investment in commercial real estate has a discrete advantage of a consistent cash flow. The properties have longer leases, which makes them steady and reliable for the income on a monthly basis. They have generally multiple units which indicate multiple streams of income. It also has a triple net lease, which generally includes the lease paying building’s real estate taxes, property insurance, and maintenance costs in addition to the monthly income.
Fewer competitors: There is less competition in commercial real estate. It is a major exertion for many investors to invest in office buildings and shopping centers. Commercial real estate represents viable opportunities, which increases the financial wealth of experienced investors. Commercial property in Modinagar has been an attraction for such investors, and they are investing there and other nearby locations, which are generating higher revenues for them.

The bottom line is…

Commercial real estate has become an attractive choice for the investors and it is offering them an array of opportunities and gains. The benefits of investing in these properties have been recognized by the investors and they are acting on it according to the current market conditions.

Author Bio: Neha Tanwar is a professional content writer. She has done her graduation in CSE, but was always attracted towards writing. Shy by nature, she loves expressing herself through her writing. She loves travelling to exotic places and is a foodie. She spends her free time by reading novels and cooking.