Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
When a person mentions "Commercial Real Estate" , just about everyone has a different idea of what it means. To some it's multi family, others consider office buildings, retail, industrial, boat slips, or parking lots commercial property. Though each of those even have sub categories, sometimes they ALL get lumped together and get a bad rap! Weigh in...
1. WHAT DO YOU CONSIDER COMMERCIAL PROPERTY?
2. Do you invest in commercial property? Why not if you don't?
3. Have you ever owned commercial property?
4. If you had the money to invest in commercial, would you?
Investor · Omaha, NE · Member since 2011 · 475 posts · 211 votes
13y
Karen M.I invest only in multifamily "commercial" presently and do so because I want it managed for me allowing me time to do my out of real estate job and also because I have neither the skills nor interest in doing the property management. I want to spend my time in real estate in acqusition and investor recruitment.
Real Estate Broker · Gibsonia, PA · Member since 2013 · 828 posts · 260 votes
13y
Originally posted by Karen M.:
Thanks for this, I was just asking myself this
1. WHAT DO YOU CONSIDER COMMERCIAL PROPERTY?
Non residential, I didn't know it included multiple family
2. Do you invest in commercial property? Why not if you don't?
Yes, only bc it was cheaper than residential (where I was at the time) good rent, and tenant cares about my unit pays for everything.
Only issue is like my other venting posts, controlled by third parties
Tenant needs municipality approval, code, zoning hearing,
If in complex with association, by laws non compete etc. like co-op.
3. Have you ever owned commercial property?
Yes, both cheaper than SFR, better rent and cash flow
4. If you had the money to invest in commercial, would you?
Just closed on second one, will if opportunity comes again
Rental Property Investor · Manchester, NH · Member since 2013 · 447 posts · 81 votes
13y
I have seen commercial used to describe retail, office, industrial, and multifamily properties; but, in some contexts, it is strictly office and retail (industrial is industrial, multi-family is residential, and office and retail is commercial use... it depends :)
I think once you start getting too big ($10,000,000+) there are too many institutional cash buyers that push yields way down.
Real Estate Investor · Austin, TX · Member since 2012 · 50 posts · 5 votes
13y
Karen M. I do invest in commercial (Austin) property. By commercial I mean light office (the zoning definition) and I presently own commercial property. I will continue to invest in commercial property given the right deal/location.
Investor · Anchorage AK and Hampton, VA · Member since 2012 · 140 posts · 82 votes
13y
1. WHAT DO YOU CONSIDER COMMERCIAL PROPERTY?
All RE Investments not less than 4 units.
2. Do you invest in commercial property? Why not if you don't?
Our investments are primarily "commercial" residential (i.e. multi's)
3. Have you ever owned commercial property?
Yes
4. If you had the money to invest in commercial, would you?
Looking at more right now. Love the multiplier effect (& passive income) of increased NOI!
Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
13y
Scott Sewell Hello Alaska! What is the market like up in your neck of the woods? My sister lived in Alaska for a little while. They loved it. From what I see on tv, it looks like some of the most beautiful country in the world. Welcome to BP!
Rental Property Investor · Southport, CT · Member since 2008 · 160 posts · 137 votes
13y
I go along with the conventional definition, i.e., non-residential income-producing property as well as residential having greater than four units. As far as questions 2-4 -- do you, have you, would you? -- (apologies to Dr. Seuss ;) ) -- yes, yes, and yes.
Now let me ask a follow-up question, one that usually provokes a lively discussion with my r.e. investment grad students: What kind of commercial property suits you best, and why?
Investor · Anchorage AK and Hampton, VA · Member since 2012 · 140 posts · 82 votes
13y
Hey Karen M. Thanks for the welcome. My wife and I are novice investors by BP standards (By the way in Alaska, BP means British Petroleum) and we are looking at acquiring more multi-family property. Alaska is a place everyone should visit at least once, and if you're lucky enough to have some sunshine, nothing is more beautiful. The market here in Anchorage is fair to good, we never had a big crash in prices as much as the rest of the country. Overall Alaska has been chugging along at about 1% growth for the last 10 years (I just listened to a couple of economists speak about this). Thanks again.
Real Estate Broker · Gibsonia, PA · Member since 2013 · 828 posts · 260 votes
13y
Frank Gallinelli
Question: what commercial property suits you best?
I only own 2 retail units and stumbled on first, and purchased our second.
#1: we were looking to invest for passive income and where we were commercial cost the same as a SFR.
commercial rent was 2700/mo,
residential rent was 1700/mo.
same sqft, taxes. BUT I didn't have to pay utilities, management fee and taxes for my commercial.
I found a GREAT tenant (good business lady) and she rented 2 yrs and it turned into 4 yrs! I didn't hear a pip out of her! she kept my place is great shape, made all the repairs, I just reimbursed her.
IT WAS HER PLACE of BUSINESS.
Meanwhile, my condo tenant, a great tenant too, but I had to fix this and that (no biggy), but I had to pay tax, management fee.
#2 we moved to our current location, and found ourselves in the same shoes, and chose to buy another retail.
we bought a building with tenant in it that didn't want to move, but owner wanted out.
economics aren't great but they have been in business for 4 yr. the only reason I bought it was because there was a tenant. commercial vacancy is HIGH here.
the only downside is LEASING and ZONING issues.... in process to re-leasing #1... and it's been a pain having to ask permission from everyone
Real Estate Broker · San Diego, CA · Member since 2012 · 104 posts · 20 votes
13y
1. Retail, office, industrial, flex space. I know over 5 units is technically commercial, but the tenants are still residential tenants. Commercial tenants are different. With commercial tenants you have better working hours (no phone calls at midnight) and less personal drama. If there's a contract dispute, the attorneys step in.
2. no. cost is high in this area
3. no, but have worked for several property management companies (mom/pops and big names)
4. yes