Commercial Real Estate Investments: The Benefits And Disadvantages
Commercial real estate investments can be an extremely lucrative career move. However, when deciding between properties such as single family rentals, and other commercial real estate, like office stave or store fronts, the experts are divided. Both have their own advantages, and both have their drawbacks. But which one is right for you?
Commercial Real Estate Investments Have High Competition
Compared to residential rentals and flipping houses, commercial real estate properties are part of a highly competitive market. The cost of storefronts, corporate office space, shopping centers and more can decimate the budget of even the most prepared investors.
Commercial Real Estate Investments Have Fewer Responsibilities
This is a big positive that many CRE investors overlook. Residential properties, such as rentals, require much more attention than other commercial real estate investments. Owners need to be available around the clock for maintenance, managements, and other tenant requests. With office space and the like, the responsibilities of maintenance, cleaning, and similar requests are left to property management companies. This gives owner the freedom to take a more hands off approach.
The Potential For Bad Management
If you are going to use a property management company for your commercial real estate investments, please do background checks and screen them thoroughly. It is all too easy to end up with a property management company that completely neglects repairs and other requests, which can damage your own business reputation.
Financing For Commercial Real Estate Investments
Financing on commercial real estate investments, such as storefronts and office space is usually much better than residential properties. CRE investors can sometimes get up to 100 percent financing on commercial investments, as well as better terms and rates than residential properties, such as single and multifamily rentals.
Do Your Research And Weigh Your Options
While the above list of pros and cons are fairly universal, the current commercial real estate market in your immediate area may be different. Always do thorough research in advance before putting money down on commercial real estate investments. Additionally, you should find a reliable finance partner who can provide a wide range of solutions for any type of commercial property. At CounselPro Lending, we work with commercial real estate investors who want to purchase, renovate, sell, rent, and refinance properties of all sizes. From single family rentals on up to high rise office buildings and hotels, CounselPro lending offers fast, efficient, and affordable financing solutions. Contact our office today to learn more.