As an investor, you might often be looking for the next business to fund. Commercial real estate in the ideal location can be an easy place to invest and grow your business. Let’s look at some basic information on investing in commercial real estate in today’s market.

 

What is commercial real estate?

Commercial real estate includes many different types of buildings that are zoned for doing business.  Conversely, residential real estate would be zoned for people to live. Commercial real estate includes strip centers, retail spaces, industrial buildings, apartments, mixed-use buildings, warehouses, and more. Despite a tumultuous 24 months, commercial real estate is coming back strong.

 

JP Morgan provides some insight on the strength of the commercial real estate market based on consumer demand. The trends noted in this insightful article reflect what we see happening in the US currently:

  • Many are not returning to work in the office and therefore need storage space for their personal belongings
  • Consumers are looking for hybrid workspace offices where they can use a space for a period of time
  • Families are in need of multi-family housing
  • New businesses are in need of store-front space to operate
  • Storage, storage, storage

 

We talk a lot about self-storage on this blog as well because we help investors find their next storage business, but storage needs are skyrocketing. In just the RV industry alone, RVs sold in 2021 saw a 33.8% increase over 2020.  (And that increase was even with huge supply issues due to manufacturing shutting down for a period of time in 2020.) People need a place to store their new toys including RVs, boats and more.

 

Why Invest in Commercial Real Estate?

 

  • Protection against inflation

Investing in commercial real estate can provide some protection against inflation. As inflation increases, the price of rent also increases because the value of your property is based on rent. As rent increases, your property value increases.

 

  • Opportunity to increase wealth quickly

Most investors do not tie up cash in a commercial purchase. Usually the purchase will be 20% down with a mortgage for the remaining debt. This allows the investor to own multiple properties without tying up all their liquidity in one.

 

  • Protection against unknown factors

Even if an investor needed a quick exit, they could easily find someone to purchase their commercial property and likely sell for profit.

 

Why Weaver Realty

With over 40 years of experience in commercial real estate, Weaver Realty can assist investors every step of the way. We offer full brokerage services, property management services, facilities maintenance and project management. We look forward to working with you to find your next commercial real estate investment. Call us today at 904-733-0039.