Guide to Investing In Commercial Property



Experts say that investing in residential properties is one paradigm most investors are comfortable with. In fact it is convenient to invest in a residential property since it is easier to understand the whereabouts of the same. However on the other hand, it is a pain much to talk about investments in commercial properties, simply because it is a relatively mysterious field, says a leading real estate in India company

 

Here is an unraveling of various aspects related to investing in a commercial property:

-Styles

Commercial property specifically consists of three types mainly:

  • ·         Retail
  • ·         Office
  • ·         Industrial

-Return on investment

It is always a smarter move to invest in commercial property owing to the fact that it is relatively low on risk but is low on investment as well, explains an expert in real estate funds in India. You can obviously go for a higher return option but note that it only comes with a higher risk. 

-Kind of risks

The possibility of a high risk comes in with higher vacancy rate. This is to say that it might take a few hours or days or months or years to find a new tenant for your property. Especially because these properties are comparatively larger in space, they need a lot of maintenance which in the absence of a tenant might dig a hole in your pocket. In comparison to these, residential properties don’t encounter such economic problems over a long term.

-Longer period of leases

While the lease period for a residential property might be for six to 12 months, the lease period for a commercial period tends to be for a longer time, remarks a real estate in India Company. Extended to as much as 5 years, you have the option to extend it to another 5 years and to as long as you wish to.

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