A common question among investors is, ‘What are the advantages of commercial real estate investments as compared to other investment options?’
There are several investment platforms available today. The stock market is one of the popular options; however, a number of investors are moving out of that venue because of market volatility and low ROI (return of investment). The platform that offers best opportunities and maximum profit in this volatile economy is a commercial property with high return of investment.
Many who previously believed in investing in the residential real estate market are getting into commercial investment properties, as the current market conditions are creating a good opportunity for making this upward transition.
Following are some of the factors that make commercial real estate investments result in higher returns:
- First of all, you can buy a property, build equity, create an exit strategy and then, earn a good amount of profit upon selling the property.
- You can earn monthly income, as you have the option of leasing or renting the property and earn monthly cash flow.
- If you are running a business out of the property, you can save the expense on rent, while building your equity at the same time.
- If the property is huge and has more space than you need for your business operations, you can rent out or lease portions of the space that is not of any use to you.
It Is a Secure Form of Investment
There are several reasons why investing in a commercial property for investment or sale, is considered to be a good investment:
- If a loan has been taken against the property, the monthly rent coming from the commercial property can cover that expense.
- If their is an increase in expense towards the property, that too can be raised in the rent given by tenants.
- The operating expenses can be paid by the tenant through NNN or NN leases.
- The improvements done to the property, by tenants, is usually paid by the them.
Therefore, investing in commercial real estate can prove to be highly beneficial as the investor receives a good amount of monthly income, as compared to residential real estate.