Whether you are a seasoned commercial real estate investor, or if you are starting to think about generating an extra stream of income with commercial properties, there are a number of things to consider. From finding the right location to keeping your expenses covered, commercial properties can either be the simplest way to make a living, or they can become major headaches. We have put together a few basics to help guide new and experienced commercial real estate investors on the road to success.
To Rent Or Sell?
This question is not as easy as it seems. For people starting out, purchasing commercial properties and making them rent-ready is a sound investment. Renting commercial properties provides a steady stream of income, and the more units a property has, the more revenue will be generated. Rent from a duplex can provide income while also covering the mortgage payments and taxes. On the other end of the scale, flipping houses, stores, shopping centers, and more can provide a lot of revenue all at once, which can then go toward repeating the process to keep building up revenue and cash reserves to purchase and sell larger or more commercial properties.
Location specifics will vary per property type. Commercial properties, such as multifamily rentals, attract tenants who want safe neighborhoods with easy access to schools, entertainment, shopping, and other amenities. People investing in office space usually prefer to have the location near other businesses, or right near a major commuting route. Flipping houses can be trickier, because some people still want the access that multifamily rentals offer, but also the privacy offered by a large yard. Location also dictates prices for both renting and selling properties. Check out the area surrounding a given property to see what similar pieces of real estate are selling for, before finalizing any listings.
Financing Commercial Properties
The best business move in commercial real estate is to avoid using your own reserves whenever possible. While banks may have their own limitations, there are a number of solutions available for purchasing, renovation, and even building commercial properties. From conventional loans to fast SBA loans, mezzanine, soft money, and even large construction financing, Vortex Funding can help. We assist people with commercial property transactions of all sizes. By purchasing, renovating, and building commercial properties of all types, entire neighborhoods and cities are improved, which in-turn brings in more revenue, better jobs, and a healthier economy. Contact our offices today to learn more.