It is important to diversify your investments in order to boost your returns and create generational wealth. One such way to do this is to invest in commercial property. You will find that having different types of commercial property to choose from is a huge advantage. Here are some popular commercial property options to consider.
1. Industrial Buildings
Industrial spaces can range from a small warehouse to a large manufacturing plant. These spaces tend to be multi-functional, but they are typically only allowed in certain areas. Flex spaces are one of the newest things to hit small businesses. Typically they are housed in industrial buildings where a portion of the floor space is dedicated to offices, while the other half is a large meeting room, warehouse, lab or something else.
2. Multi-Family Buildings
Apartment buildings are probably the first thing that come to mind when you hear commercial property. Multi-family buildings can be small or large. Flats give you the ability to start small and work your way up. You can be as hands on as you like. Property management companies can take care of most of the issues that come up. Just make sure that you take into account overhead and operating costs, property taxes, upkeep and repairs.
3. Self-Storage Facilities
Self-storage facilities are great because most of the responsibility falls on the storage unit lessee and because economic downturns don’t make much of a difference to your bottom line. Unpaid units can be recouped via auctions and you can remain pretty hands off. There’s not a lot of remediation to do when a tenant moves out and there’s no sinks and refrigerators to repair.
4. Mobile Home Parks
As long as most of your tenants own their trailers, mobile home parks can be a very profitable investment. This means that you are not responsible for home repairs. You just need to keep the grounds clean and landscaped.
5. Shopping Centers
Retail property is pretty popul;ar because of the high rents and long leases. Whether it’s a strip mall, a large shopping mall or a small building that only houses one business, retail property can be very profitable. Even single business retail spaces have their advantages. Some have residential units overhead that can be rented for additional income.
6. Office Buildings
One reason to choose office buildings is that corporate tenants tend to sign much longer leases and are considerably more likely to be on time with their rent. Office buildings are classified according to their construction and location. Class A buildings are highly sought after and tend to seek higher rents, while Class C buildings tend to be older and in less desirable locations. Your building’s proximity to amenities, age, location and square footage will determine your rent rates.
Whether you’re a retired person or a working individual, the passive income you get from owning commercial property can do a lot to secure your future and that of your future generations. Commercial property is usually a low risk venture, but it also takes some strategic thinking and planning.