A lucrative option for skilled investors
Residential investors are often hesitant to invest in commercial real estate.
Larger purchase prices, lengthy closings and complex financial and legal processes can hold back the most skilled residential investor from jumping into commercial real estate investing.
And while it’s true that commercial real estate can be a bit more complicated, if you have the right training and a solid network to guide you, it’s possible to enjoy a more professional and predictable environment than you’ll find in residential investing.
The main types of commercial real estate include:
Examples of multi-family real estate include:
- apartment complexes
- high-rise condominium units
- duplexes, four-plexes, etc.
Examples of retail commercial real estate include:
- strip malls
- retail centers
These properties are often situated in urban locations and range in size from 5,000 to as much as 350,000 square feet.
This type of commercial real estate is typically further broken down into three categories:
- Class A
Extensively renovated or newly built properties that are in very good condition.
- Class B
A very popular commercial investment, Class B properties tend to be older buildings that, while maintained well, simply need updating and/or some minor repairs.
This class of investment offers great returns with a minimum of capital infusion.
- Class C
As you might imagine, Class C commercial real estate requires intensive capital outlay to become profitable.
These buildings are often the target of redevelopment ventures as they’re situated in poor locations, have high vacancies and require many repairs.
Industrial commercial real estate is usually geared towards manufacturers, offering them spaces with height specifications and the ability to unload freight via docks for trucks and/or rail.
Examples of commercial real estate properties that can be designated as “special use” include:
- self-storage units
- sports stadiums
- amusement parks
- mixed-use development (a mix of residential and commercial use spaces within the same complex)
If you’d like to know more about investing in commercial property in Houston we have the experience and the knowledge to help you learn and profit from commercial real estate investing.