Are You Looking to Start Investing in Commercial Real Estate? Check This Out
Commercial real estate can provide significant income for investors. But while it is a field that promises great rewards, there are certain things you need to know before investing in commercial property. Here is a guide to get you started.
What is Commercial Real Estate (CRE) Investing?
This means investing in properties used for business purposes. Unlike residential real estate, in CRE, the investor creates leases and collects rents from businesses. Commercial real estate can also include raw land that you plan to develop commercial properties. There are various types of commercial properties, including:
Multi-family (apartment complexes and condos)
Special purpose properties such as health care centers, hotels, churches, bowling alleys, and daycares are also included in commercial real estate.
What You Need to Know Before Investing in Commercial Real Estate
Commercial real estate can allow you to invest in multiple properties, giving you several income streams. Because of this, it is considered a more stable investment. Depending on the type of property you own, your cash flow can be hundreds of thousands. Plus, if you work with a property manager, the whole journey becomes less tasking. But even with all those advantages, CRE has a big price tag. You need a huge downpayment, and at times, getting a loan to buy a property can be challenging.
What Is the Most Profitable Commercial Real Estate?
A property with a high number of tenants will give you significant profits. Such properties include office spaces, multi-family housing, self-storage facilities, and mixed-use buildings. The more tenants you have, the more money in your pocket.
Once you decide on the type of commercial property you want, you will need to secure funding. It can come from conventional loans, government loans, owner financing, or syndication. Most lenders will review your net worth, experience in CRE investing, business plan, and creditworthiness. After securing financing, you can go ahead and get the property you want.
If you have set your eyes on a commercial property and you want to invest in it but need funding, Charis Commercial Capital can help. We provide commercial real estate funding to investors ready to take the plunge. Call us today.