What is Commercial Real Estate?


The types of Commercial Real Estate or Commercial Property available for investment are very diverse and varied. Some examples are as follows:
  • Office Buildings
  • Motels
  • Industrial Warehouses
  • Malls
  • Factories
  • Supermarkets
  • Industrial Land
  • Strip Shopping Centres
  • Medical Centres
  • Shopping Centres
  • Hotels
  • Business Parks
  • Tourism Facilities
  • Car Parks
  • Businesses

 

Commercial Real Estate as an investment which can perform extremely well and pay excellent dividends over the long term. There are many factors for consideration when researching to invest.

 

Strengths:

  • Bricks and mortar - solid physical investment
  • Generally achieve higher returns than residential property investment
  • Longer term tenancies
  • Annual capital and income stream growth
  • Less ongoing costs for the owner
  • Tenant pays outgoings
  • Set and forget

 

Potential Weaknesses

  • Long term property vacancies can occur
  • Poor property management and lease administration
  • Under or over market rentals
  • Lack of owner capital reinvestment
  • Change of market requirements

 

 

A few thoughts on purchasing and managing investment property...

 

Property represents a very secure, sound and long term form of wealth creation. As such, many people are turning increasingly to property investment to secure their future.

 

A well-managed investment can offer many advantages including income and capital growth. Many investors may also be able to use their investment to reduce tax payable on their assessable income.

 

Property is often a highly sought after addition to many investment portfolios, particularly with people who do not need immediate access to their money and wish to protect themselves against inflation over the long term. It is important, however, to be aware of the responsibilities of managing your property investment and assuring proper care and responsibility.

 

As considerable investment is required, you need to take the time to get good advice before you act - and remember, consideration of any investment presents wide and varied alternatives and there are always plenty of experts ready to pass on their opinion.

 

It is wise, therefore, to always seek appropriate advice from a qualified financial advisor or your accountant.