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INVESTMENT ANALYSIS
There are a number of ways to generate passive income from real estate investments. Perhaps one of the most common ways to is through rental properties. Investors who work with the Vidona Group can create a steady revenue stream from rental income.
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We will ensure the amount of rent you collect surpasses the amount paid for mortgages, maintenance, taxes, insurance, and property management services. We'll also help you identify value-add properties, navigate 1031 exchanges to defer paying capital gains taxes, and determine the right time to buy or sell your commercial real estate investment properties.
Understanding The Commercial Real Estate Landscape
Commercial real estate is unique in the sense that you can craft a portfolio with quite a bit of diversity, if you so choose. There are five key types of commercial real estate that an investment property expert may advise you to consider. These include:
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Office
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Retail
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Industrial
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Multifamily
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Special Purpose
Benefits and Potential Disadvantages of Each Sector
Office Space
Office space tends to be what people are most familiar with when it comes to commercial investment opportunities. This classification applies to everything from single-tenant offices to the soaring skyscrapers. Office space is divided further into three categories: Class A, B, and C.
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Class A - typically newly built or renovated in an ideal location with extensive amenities.
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Class B - tend to be older buildings requiring capital investments, including minor repairs and upgrades.
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Class C - most often used for redevelopment, typically due to poor location or out-of-date infrastructure.
Depending on the city you’re considering investing in, an investment property expert will be able to offer insight that will direct you either toward or away from office space in order to gain the highest yields.
Retail
Retail space is another category of commercial investment opportunity. Retail space offers quite a range of options, including stand alone properties like banks or restaurants, small-scale multi-unit properties like strip malls, and even large-scale multi-unit properties like community retail centers. Square footage in retail properties can vary from a couple thousand square feet to a couple hundred thousand square feet, giving investors flexibility on their price points and yields.
Industrial
The research shows that if you’re going to unilaterally select a sector to invest in, industrial property is the place to be. Thanks to the rapid growth of online shopping, the need for and use of industrial real estate has boomed in recent years. While it is on the pricier end, any investment property expert worth their salt would recommend getting involved in the industrial sector of commercial real estate.
Multifamily
Multifamily is a very niche category of commercial real estate that includes apartments, condos, and smaller units that can house multiple families. Many experienced residential investors will use multifamily properties to bridge the gap into the commercial space. If this is something you’re considering, you will want to talk to an investment property expert who specializes in commercial space. Depending on the residential real estate trends of renters and buyers, you will ant to talk to the Vidona Group experts who specialize in multifamily housing.
Special Purpose
Special purpose commercial real estate caters to the niche business types that require specific elements to operate. These types of properties may include car washes, self-storage facilities, or any other kind of operation where the infrastructure of the building meets highly-specific operational needs. Mixed-use commercial property also falls into this category and encompasses properties that can support various types of use, including residential, retail, and even public sector.
Investing in commercial property has a high barrier to entry, but it can be an extremely lucrative route for those who choose to do it right. Investing strategically is the key, though. Without an investment property expert guiding your decisions, you won’t be able to achieve the returns you’re looking for. With many years of experience serving as the commercial broker for those investing in commercial property, we’ve developed the industry prowess to help our clients build a portfolio of investments that is right for them.
The Benefits Of Investing In Commercial Real Estate
As we’ve laid out above, there are a lot of options when it comes to investing in commercial real estate. Working with a property investment expert can help you reap the maximum benefits of a well-planned strategy. Let’s review some of the reasons to consider investing in the commercial market.
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Potential Income - The key reason anyone invests in anything is the potential for higher income and more cash flow. Commercial real estate is no different. While the price points are much higher than that of other investment opportunities, the yields often parallel, generating a sizeable passive income for the investor.
More Opportunity - The commercial space is great because the high barrier to entry means there’s less competition for the serious investor, especially one who is supported by an investment property expert who specializes in commercial properties.
More Stability - Another key benefit of investing in the commercial market is the extended leasing period. This means less time and energy has to be spent marketing and leasing the property on an annual basis and more stability in income during the leasing period.