Should You Invest in Commercial or Residential Property?

Brian l katz

When it comes to investing in property, many people immediately think of investing in residential property. This is a logical consideration; after all, most people likely have more experience with buying a home than any other type of building or property. But while many property owners are able to profit from renting out residential property, the gains of this type of investment often pale in comparison to commercial real estate. According to research from IBIS World, the commercial real estate industry is worth around $945 billion in the United States alone.

Unlike owning a single-family residence, commercial properties like restaurants and apartment buildings offer a more stable and consistent source of income. While a residential tenant might choose to leave as soon as their lease is finished, a business is more likely to remain in the same location for years. Moreover, if a commercial property has multiple renters at once, as a multi-family apartment building and other properties will, a property owner will face a smaller loss of profit if one tenant decides to leave. Both of these qualities mean that a commercial property owner can expect a consistent cash flow of rent, sales profits, parking fees, vending fees and tax benefits for several years at a time.

However, a lack of experience in purchasing commercial real estate is a real and troubling concern. For this reason, many people turn to commercial real estate companies to help them evaluate the risks involved with purchasing and maintaining commercial property. After a property is purchased, commercial real estate companies also help investors purchase, develop, and rent out the location, as well as assist in managing cash inflows, outflows, and financial risks. There are a number of reputable firms in this field: for example, American Real Estate Partners, run by president Brian L. Katz, has helped acquire, finance, and maintain more than $1.8 billion of office, flex, industrial and residential assets. Brian Katz has spent more than 25 years in the real estate industry, giving him valuable experience that can prove extremely beneficial to new investors.

If you find yourself wondering “should I invest in property?”, it would be a waste to not consider the benefits owning commercial real estate could offer you. Don’t let your lack of experience hold you back: contact a reputable commercial property management company to discuss your situation with a professional like Brian L. Katz today.