Commercial real estate: The big profits

Real estate is often termed as the safest investment avenue. In fact, real estate investments done with proper evaluation of the property (and its true value), can lead to good profits. This is one reason why some people pursue real estate investment as their full time job. The talks of real estate are generally focussed towards residential real estate; commercial real estate seems to take a back seat. However, commercial real estate too is a good option for investing in real estate.

Commercial real estate includes a lot of different kinds of properties. Most people relate commercial real estate with only office complexes or factories/ industrial units. However, that is not all of commercial real estate. There is more to commercial real estate. Health care centers, retail structures and warehouse are all good examples of commercial real estate. Even residential properties like apartments (or any property that consists of more than four residential units) are considered commercial real estate. In fact, such commercial real estate is much in demand.

So, is commercial real estate really profitable? Well, if it were not profitable I would not have been writing about commercial real estate at all. So, commercial real estate is profitable for sure. The only thing with commercial real estate is that recognising the opportunity is a bit difficult as compared to residential real estate. But commercial real estate profits can be real big (in fact, much bigger than you would expect from residential real estate of the same proportion). You could take up commercial real estate for either reselling after appreciation or for renting out to, say, retailers. The commercial real estate development is in fact treated as the first sign for growth of residential real estate. Once you know of the possibility of significant commercial growth in the region (either due to tax breaks or whatever), you should start evaluating the potential for appreciation in the prices of commercial real estate and then go for it quickly (as soon as you find a good deal). And you must really work towards getting a good deal. If you find that commercial real estate, e.g. land, is available in big chunks which are too expensive for you to buy, you could look at forming a small investor group (with your friends) and buy it together (and split the profits later). In some cases e.g. when a retail boom is expected in a region, you might find it profitable to buy a property that you can convert into a warehouse for the purpose of renting to small businesses.

Although this recession crisis make a big impact on the real estate business. Rockefeller make his wealth from this crisis. Rich people doesn't care about any crisis....

So commercial real estate presents a whole plethora of investing opportunities, you just need to grab it.

Hi,

Thanks for such a great post. It was worth to read it. However, as being professional buyer's agent, real estate is the best option for long term investment to get good profit from it.

This post has been edited by george29: May 20 2009, 01:43 AM

Hello,

It's been said one of the best way to ruin a friendship is to loan that friend money. I tend to believe that, I have never invested in commercial property, but I have invested in multi units residential property with friends and business associates. When you incounter problems and you are going to run into problems vacancies,maintanance,tenate problems etc. There always tends to be some finger pointing as to who's at fault, or how much money it's going to take to solve the problem. So I believe it's true that commercial real estate can be very profitable I would have just one word of caution to wouldbe investors, that is if you are going to invest with partners make sure they have a good understanding of real estate. Very good post commercial real estate is definintely something to look into.

http://foreclosurehardcash.com

Hi there,

It is true that commercial properties are going to be the biggest wealth creators for the foreseeable future. But potential investors need to consider the type of commercial properties they want to get involved in. They need to decide also how much time they are willing to put into the day to day operations, or are they going to delegate most of the tasks to professional property managers.

If the properties are bought at a good price and held for appreciation, they can still produce a nice monthly cash flow (especially once you get them rented up and do your properly scheduled rent raises). But you have to get into the types of commercial real estate geared for this. Apartment complexes can produce a nice steady monthly cashflow, if you don't mind dealing with tenants and toilets. Many who start off doing it themselves, quickly and happily give up a part of their monthly cashflow to pay the professional managers to do it.

There are certain commercial properties that you do not have to worry about tenants and toilets at all. Such as "Self-Storage Facilities". That is an excellent recession proof investment. Other recession proof commercial real estate investments are "Mobile Home Parks", "Senior Living Facilities" and "Assistant Living Facilities". Of course, you also let the professionals manage those, unless you have experience in those areas.

If you don't have the need or desire for a steady monthly cashflow, but instead would prefer a big lump sum profit take, then you may want to consider flipping commercial property. Yes, commercial property can be flipped for huge profits, but it has to be done right. What kind of huge profits? We're talking possibly millions of dollars in profits, for flipping just one deal! This too depends on what type of property, and what profit spread you negotiate for yourself. Again, you need to know what to look for and how to acquire it, and how to flip it. And you need the funds to flip it.

Unless you are willing to get the proper training to do it, you may want to stay away from flipping commercial real estate, or any real estate for that matter. Nothing at all will happen if you can't close the deal.

Just to give you the heads up.

JoAnn

thank you very much

The discussion is quiet good and worthy. I am very much interested in real estate business. I have saved enough money myself to invest their right now. But was very much worried about the ups and downs in the market, this was all due to improper knowledge on real estate market. But I was very much relaxed when I watched a video.
Go through this cool video :
http://www.beginnerrealestatewealth.com/bonusvideo.html

Thank you very much charle,
It helped me out..

The video is well and informative. It has well explained about various topics on how to invest in real estate.
Awesome work Haris.
Please let me know if you have any such videos more.

thanks, great advise, I will think about it

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