Setting up any property portfolio can be challenging. Investments require research and careful calculations, and it takes time to build a successful portfolio.
To build a profitable residential portfolio, you can buy property below market value, reinvest profits, learn about demand within the local property market, and ensure tenant happiness through renovations and upgrades. While the same is true for commercial, also requires additional knowledge.
With introduced earlier this year, more investors are now moving into the commercial property market. To help you capitalise on the investment opportunities, here are the types of commercial properties explained, to help you set up your portfolio.
Offices are perhaps the most common form of commercial property investment. When investing in office space, the most important consideration is location. Start your search by thinking about transport links (such as public transport and access to motorways), local amenities, proximity to town and city centres, and other surrounding offices and businesses.
Secondly, think about business demand. Many businesses now prefer open work spaces that are said to foster productivity through collaborative team work. Others have embraced technology, allowing employees to work from home or use a hot-desk system. Small individual offices are no longer on trend, so make sure to consider layout before buying.
The retail industry has suffered a set-back, both with the recession and online shopping, with many national companies have closed their doors and gone into administration. However, there are still some great retail investment opportunities to be had.
To boost the profitability of your investment, look for spaces that could suit multiple purpose use, or that include an additional space which could be rented separately, either for business or residential use. However, the most important consideration is cost. Can you afford mortgage payments should the property be vacant for an extended period?
Unlike retail, industrial units have seen real growth in recent years, largely thanks to online shopping. Brexit could also provide a further boost, with costs of importing and exporting goods expected to increase after leaving the single market, leading to an . This means that investing in industrial units could be a great way to build a commercial portfolio.
Commercial property can be a fantastic investment. Research the local area before purchasing, ensure that you have the capital to cover any vacancies, and think about the investments long-term prospects, to help you build a successful commercial property portfolio.
Commercial Real Estate Report 