Profit From Commercial Real Estate Investments

Profit From Commercial Real Estate Investments



Profit From Commercial Real Estate Investments
Property investors have now turned their attention towards the​ lucrative deals presented by the​ commercial properties. This sudden interest is​ the​ result of​ the​ option to​ diversify your property investment portfolio, along with a​ high income and​ tax breaks. However, it​ is​ advisable to​ conduct a​ research before taking the​ plunge.
Commercial properties include hotels, malls, medical centers, retail stores, business and​ industrial property. These are operated for​ a​ profit from rental income or​ capital gain. Some common commercial property types are
Apartments and​ multi family units These are the​ first choice of​ investors. Apartment financing and​ management is​ very similar to​ that of​ residential properties.
Mobile home parks These can be a​ profitable investment option especially if​ you own the​ land and​ sell the​ mobile homes.
Retail properties More than one tenant occupies the​ premises and​ it​ is​ utilized for​ retail transactions.
Offices This category includes suburban garden offices, suburban highrise offices, medical offices and​ central business district offices.
Mixed use properties These properties are a​ combination of​ all the​ above property types.
Health care units They include assisted living centers and​ congregate care centers and​ nursing homes.
Hotels the​ properties are categorized as​ either limited service or​ full service.
Industrial premises These properties can be used solely for​ industrial purposes.
Selfstorage units the​ consumers use them for​ personal storage or​ for​ lease.
Other specialties These include oil change facilities and​ gas stations.
According to​ a​ reputed New York based real estate research firm, the​ price of​ apartment complexes rose by 26%, retail properties by 14%, industrial properties by 21% and​ office buildings by 6%, in​ 2004. Commercial property investment is​ very profitable but it​ is​ a​ complex business, as​ compared to​ investment in​ residential properties. There are number of​ factors that affect the​ property evaluation of​ commercial premises. it​ pays to​ study the​ market and​ tread cautiously.
Boom in​ commercial real estate property
Commercial real estate includes, but is​ not limited to, properties used for​ educational, medical, commercial or​ industrial purpose. the​ properties are usable in​ business or​ trade and​ can be sold or​ bought in​ the​ real estate market. the​ improvement in​ the​ economy and​ growth in​ business ventures are responsible for​ the​ revival of​ commercial real estate. Another important reason has been the​ continuous flow of​ new investment capital. This capital is​ sourced from people who seek higher returns from large investments. the​ areas that come under the​ category of​ ‘commercially profitable’ carry a​ higher evaluation, as​ compared to​ other properties in​ developing areas. the​ rates for​ commercial real estate properties are calculated differently from the​ method adopted for​ residential properties.
The rental yields are better for​ commercial properties and​ the​ monthly cash flow is​ more than that of​ residential property investment, in​ the​ same area. the​ quoted expectation of​ returns depends on the​ kind of​ business that would be transacted on the​ premises. the​ profit from commercial real estate investments is​ definitely much higher than profit generated from investments in​ residential properties. Investment in​ commercial real estate is​ as​ lucrative as​ investments in​ stocks and​ bonds.




You Might Also Like:




No comments:

Powered by Blogger.