Investing in commercial real estate is an entrepreneurial way to make an adequate passive income. It requires knowing new terminology and skills as with any other profession, but once one understands the ropes, it can become easier to handle and to grow. In summary, commercial property includes shopping malls, retail centers, office buildings, industrial buildings, self-storage units, apartment buildings, and mixed-use buildings. If you are considering this profession, take a look at some of the benefits it offers.
As opposed to residential property investing, commercial property investing reaps higher wages per year. Depending on the location, a commercial building could give an annual return of 6-12% the purchase price. Commercial tenants also tend to have longer leases, which promotes a stable income.
Commercial tenants and investors alike treat commercial properties as business, and therefore are more likely to keep the owner-tenant relationship professional and courteous. Both parties want the best outcome for the building as well; in the public eye, both are more likely to work together to maintain the property than perhaps in a residential situation.
Another advantage it has over residential investing is objectivity in pricing. Residential property pricing may be more driven by sentiment than actual value. Of course, many factors affect real estate costs. If you notice commercial premises priced much more reasonably than the local residences, you may want to go for the commercial one.
Triple Net Leases
In a triple net lease, the owner does not have to pay for maintenance costs, only the mortgage and structural repairs like the roof. Some businesses who need to maintain a specific brand image will want to manage the costs themselves.
Limited Business Hours
Lastly, commercial property investing comes with the relief of limited business hours. You will not need to answer a call in the middle of the night about someone’s lost keys or clogged toilet. Since businesses reside in the units, you’ll likely only need to handle calls at business hours. You can also set up the system so that in an emergency, signals will go out to the proper authorities rather than yourself.
Trust the Professionals at Clagett Enterprises for Your Realty Needs
If you’re looking for an experienced property management company, the perfect realtor for your property, or a professional to assist you during your purchase of any home, you can rely on Clagett Enterprises. Clagett Enterprises is a full-service real estate company with almost 30 years of experience in the Frederick and Western Maryland area. For assistance with commercial sales, leasing, management, and development and consulting, contact us online or give us a call at 301-665-6009. To meet our team and see some of our beautiful homes, follow us on Facebook, Twitter, and Pinterest.