If you are looking for a good return on commercial property, you must have a solid understanding the ins and outs of real estate in the area. Commercial property can be a great find – and a great moneymaker, but you don’t want to leap first and ask questions later.
There are various types of commercial property. Let’s look at them individually.
• Offices: tend to have a high value when situated in the central business district of an urban area or business district. Major office districts, regional centers and suburban centers are other viable areas. Think about where people are working. Probably not in the middle of a cornfield. Look at the area carefully, and see if this is a place companies WANT to do business. A good thing about office real estate is that there is a slightly different wear and tear. Doubtful that the place will be trashed from a raging party or burned down from a kitchen fire. Offices are also generally used less then 24 hours a day. They do come with different needs though, from electrical to plumbing. Consider this when investing.
• Retail: Certain retail sites will always be at a premium. Location is key in getting the greatest investment potential for your money. Shopping centers, strip shops and malls have a great return on investment. The hot places that people are spending money are the hot places to rent out. But, sometimes retail areas can be fickle. New shopping malls spring up all the time, driving other malls out of business. Make sure the place you are investing in isn’t gone to be usurped by a new mall annex or a moving highway.
• Commercially zoned real estate: This is a bit trickier. This type of property can be improved by converting it to a multiple use property - office, retail, residential. Mixed use real estate like this can buffer you from changing economic factors – and ensure you have a steady stream of income. This is sometimes trickier to mange and rent – so you will probably want to work with a knowledgeable property management firm.
Kuester Property Management