Investors who are active in residential real estate in Los Angeles may want to dip their feet into the commercial property world. After all, purchasing properties offering commercial leases has some special perks. Here is a glimpse at why going commercial might be a smart idea.
Commercial real estate properties are equivalent to businesses that come with overhead costs. The right commercial property may be one used for a factory, a warehouse, a storage facility or a medical facility, for example. Commercial properties are categorized into classes, with Class A properties being easy to access, B properties requiring some minor upgrades and C requiring hefty capital investments. The benefit of these types of buildings is that they can have several units, which means multiple streams of income. Furthermore, commercial leases typically last longer than their residential counterparts do.
Research shows that commercial property sales are on the rise in 2018. Part of the reason that commercial real estate is so big is that it can handle fluctuations in the market more easily due to the multiple high rents that investors can get from tenants. In addition, since commercial real estate is tangible, it provides stability and can be used as collateral.
Although getting into the world of properties featuring commercial leases can be exciting, it can also be nerve-wracking. After all, commercial properties come with high price tags, so more is generally at stake with commercial versus residential real estate purchases. Fortunately, an attorney in Los Angeles can walk an investor through the legal aspects of a commercial real estate deal to ensure that his or her best interests are protected each step of the way.