Real estate investment is one of the highest-paying forms of investment in the world. Although it involves high risks, when profitable, it yields high interests. “Recently commercial real estate has taken a hit due to covid,” Daniel Pessin said. Does that mean its a good time to invest in commercial real estate now? Let’s take a look at the different types of commercial real estate and see.
There are basically five categories of real estate: commercial, residential, industrial, private, and land use.
What is Commercial Real Estate?
Commercial real estate refers to properties that are solely for businesses. People invest in them to make profits. There are a lot of opportunities available in commercial real estate. You can invest in retail space, warehouse space, and office space, find industrial space for lease, or purchase land for development. Commercial real estate includes; hotels, theaters, grocery stores, schools, gas stations, apartment complexes, plazas, and storage spaces.
Let’s take a step further to look at why now is the best time if you’re intrigued by the commercial real estate space.
Why Now is the Best Time to Invest?
Due to the global pandemic caused by Covid-19, there’s been a drastic reduction in the purchase and sale of goods and services..
According to the financial support and resources available for businesses impacted by COVID-19, there is an expected increase in the economy of many provinces highly affected by the pandemic in 2020.
The equity gains are real when investing in commercial real estate. Reason being that there is a drastic fall in the prices of investment properties.
People are selling off their lands and giving out their industrial space for lease at an affordable rate.
If you invest in commercial real estate now, let’s say, you acquire land for sale at $400,000 which was sold at $750,000 before the Covid-19 pandemic, then you hold on to it for a few years, there’s a high chance of selling that land off at the rate of $1,000,000-1,200,000. This would be an incredible return for you.
“Investing in commercial real estate is still profitable due to an increasing growth rate in the population. The impact of Covid-19 might have lowered the demand for investment properties, but that was temporary,” Daniel Pessin said.
With college students resuming and major development setting in, immigration will likely hit high records, the demand for land for sales and rental properties will increase.
One of the best ways to make money from commercial real estate in investing when the market is low and selling when it’s high.
Factors to Consider Before Investing in Commercial Real Estate
When it comes to commercial real estate, there are some basic factors to consider before investing;
- Determine your budget and stick to it
- Secure commercial real estate financing
- Cover the due diligence
- Meet an investment consultant
- Consult a real estate investment group/agent
If you’ve been asking yourself, is investing in commercial real estate worth it? It is interesting to know that historically, investors have made huge profits from investing in commercial real estate.
COVID-19 might have closed down some businesses, but with a forward-looking mindset, you can secure strategic long-term investment opportunities through commercial real estate by investing at a fraction of its initial cost before the pandemic. “This could be the bottom,” Daniel Pessin said. “Let’s see.”