Investing in Commercial Properties: What's in it For You?


Economically, times have been tough for the past few years. With recession and a million other monetary upheavals, it has been a depressing time. But it just might be that things are looking up now.

There is a saying in commercial real estate, “If you think nobody cares you’re alive, just miss out on some mortgage payments.” Unfortunately, a lot of that was happening around 2008 what with the rise of the credit crisis as real estate values plunged down and all chaos broke loose.

But to expert investors, times of great turmoil typical seem as the best possible way to uncover great investment opportunities and that is what happened. Even with all the naysaying, the commercial real estate business did not lose out much thanks to a number of investors increasing their holdings.

Chatting with any serious real estate professional is sure to escalate into an eruption of dialogue stating how commercial properties are a better opportunity to make money than residential holdings traditionally favored by the people. Seeking help from commercial property consulting company like Altus Group can surely do the magic for your ROI.

Commercial property transactions offers additional money flow, benefits of the economies of scale, open playing field, affordable brokers as well as bigger markets and payoffs. This field is facing a demand revival with the supply mechanisms aching to catch up to the longings of the money market.

Due to shortage of office buildings owing to lack of construction in the recent years, office rents have skyrocketed today and it is a highly profitable venture therefore owing all its success to high rental yields and low capital values. In various markets, commercial spaces are sold for less but still return high rental incomes thereby, adding to the entire magic of the business.

Capital appreciation is down in commercial property owing to a large market of speculative buying in residential projects. Office properties are driven by end use and so it may not be so easy to get off your hands but finding tenants for office space has always been and will always be easier than for residential buildings.

Rental periods are also longer for the office spaces and hence they are less likely to be vacated as all office tenants generally pay up front for any fittings required making it a bit undesirable to transfer their premises from one place to another. Again, a brand or bank that depends on its locality is less likely to change premises than those startups or setups where a lot of the work depends on human resources or employee talent potential.

Commercial spaces also provide an opportunity to form professional relationships and help to forge long lasting transactions. Also, the rented space is better taken care of in commercial real estate setups as the viability of the product or services offered by a particular brand is directly dependent on the maintenance done on the space by the tenant. So it is surely an incentive to better take care of your property while paying you great sums at the same time. Also, offices have fixed working hours. Barring fires or break-ins, there are no other scenarios when you might be woken up at night due to any disturbances. Owning just got so much easier, right? There is so much flexibility in lease terms that it is almost always a win-win scenario for both the tenant and the investor.

Of course, the name of the game is business acumen and an eye for interesting deals that pay off. Capturing motivated sellers and getting adept at the art of neighborhood ‘farming’ (read scanning).

At the heart of the matter is basic human interaction skills. It is all about building rapport and a healthy working relation with the people you do business with. Instead of always cashing in, try to make the situation a mutually beneficial scenario. Make people happy. Some of it will surely come back to you.

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