Commercial Real Estate Investing

By: Brad Wozny

In the business of the real estate investment, commercial real estate investing is an important element of the whole investment scenario. While most commercial investors would like to believe that this is a specialized sector, the truth remains that commercial real estate investment is only as safe or as risky as any other businesses and needs experts and the right advice to achieve success.

Before starting your commercial real estate investing venture, be clear about the area you want to invest in, the kind of money you want to put in and the potential area targeted. There are two kinds of approach to commercial real estate investing. These being the traditional-wait and watch-over-the-year's kind and the second being the flip-flop category, where buying and selling take place rapidly.

Real estate experts will tell you that, any type of commercial real estate investing is a mix of luck as well as right instinct. Though this may be correct, yet when you are investing big money it seems hardly advisable that you do so on the basis of pure assumption and luck. Therefore before you go for commercial real estate investing, it is mandatory that you have proper knowledge and understanding of the local commercial real estate scenario, market-timing dynamics, as well as a lot of research work information on the trends for a period of time.

There are times when it makes sense to look for a buyer even before you decide which property it is that is up for sale. At other times, it is plain luck that helps us to decide on a piece of property. commercial real estate investing has a lot to do with being at the right place and at the right time either when the land prices suit you or you find a piece of property at a price that is sure to give you great returns.

Your decision to invest in a particular property for commercial real estate investing should be based on certain specifications:

- Is the property you are investing in, an already developed area or is it still developing?
- How commercially viable is the property?
- How much of maintenance cost will be required in maintaining the property?
- What are the future prospects in monetary terms?

Like the residential, the commercial market is not much influenced by interest rate changes. The commercial sector has more to do with infrastructure and business growth. The returns in commercial real estate investing are much better than the residential. Investment returns vary from 6 - 15%.

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