Investing in commercial real estate has many benefits just like any other investment vehicle. When you are looking for real estate investment that is virtually inflation resistant, commercial real estate is your best option.
People invest in real estate because they have previously had positive experiences of buying homes. And today we'll tell you why commercial real estate is an even better idea. For starters it is great way to balance your investor's portfolio. Commercial Real Estate Finance LLC is listing the reasons why investing in commercial real estate is such a good idea:
1. Easier Access to More Capital Guaranteed!
Try raising $150,000 for a residential property. Now let me tell you that raising a couple of million dollars for a commercial property is far easier than that! It is fairly painless to raise large amounts of capital for commercial properties.
So why, as an investor, would you not take advantage of the private equity firms, hedge funds, and finance companies that are more disposed to do joint venture projects and provide the needed capital to complete a real estate deal. Commercial Real Estate Finance LLC, typically raises 80 to 90% of the equity for a particular transaction, by partnering our operating clients with institutional or high-net-worth capital partners, who put up a majority of the equity promote. We also specialize in providing creative capital solutions, which include multi-tiered capital structures for a particular transaction.
2. The Commercial Real Estate Market is Less Saturated!
There is residential real estate agent around every corner. But not many are willing to work with commercial real estate. Most commercial properties fall under $5 million price range. This makes them too insignificant to be of interest to institutional investors and way too big for the usual, run of the mill, residential investors, making the residential market more competitive.
3. "Forced" Appreciation Is Possible For Commercial Real Estate!
When it comes to residential properties, there really isn't anything you can do to increase its value considerably. For example, no matter how many additional features you put in the house, is value will be determined by the neighborhood comps only.
On the other hand, in commercial properties, the valuation of a property is mainly based on the income generated by a property. So the more revenue a property generates the more it is worth. Although, the comps of the area still matter for commercial real estate, but revenue matter more because it is valued in terms of capitalization rates.
So, you can effectively force the appreciation for your commercial real estate by finding better, smarter ways to increase the revenues generated by the property.
The Last Word!
Commercial property has many benefits but just like any other investment vehicle, it also definitely has its disadvantages. And it definitely isn't for everyone. However, when you are looking for real estate investment that is virtually inflation resistant and supremely tax advantaged, commercial real estate is your best option.
Commercial properties have time and again proven to be the real hard assets in a business that is never out of season. Commercial Real Estate Finance LLC has had astonishing success accessing numerous capital sources throughout the world. You can reach us at 855-515-5585 or visit our website at www.cre-finance.com.