There are many advantages to investing in commercial real estate when compared to residential investing or flipping houses. As with many things, the individual investor needs to have a deep desire to add this type of investment to their portfolio. It’s not for everyone. Advantages to investing in commercial properties include greater potential income, a steady flow of cash, better leasing options and a reduced risk of long-term vacancies. Of course, with any venture, there are potential downsides. This is why it is imperative to partner with an experienced and successful commercial investment firm in NYC that leads and guides the investor through the entire process.
The Rewards Outweigh the Risks
Hands down, the number one reward to commercial real estate investing is the return on investment and a higher potential for income. Not even a residential real estate investment comes close. While a commercial real estate in NYC may bring in a return of six to 12 percent, a residential investment may bring in a one to four percent return. More lucrative and longer leasing contracts, lower vacancy risks and more property units contribute to this overall higher rate of return to the investor.
Let the Cash Flow
One distinct advantage to commercial real estate investing is cash flow. The cash flow can be more consistent and abundant than residential investments. Because of higher and longer-term business leasing contracts, an individual investor may rely on a steady stream of income coming in on monthly basis. In addition, commercial properties usually consist of multiple units to rent out. If the contract is just right, some tenants may end up paying operating costs on the property, instead of the investor or investors.
Benefits to Investing in Commercial Real Estate
There are many reasons an investor may choose to invest in commercial real estate in NYC. By way of example, an investor in commercial real estate may reap many rewards including future wealth and security, tax benefits and a diversification of their financial portfolio that speaks volumes when seeking other types of investment opportunities.
Avid Realty Partners is a commercial real estate investment firm in New York and Dallas that has built a solid reputation of success for its investor clients.