As an investor in commercial real estate, your options for new investments may be endless. Before entering into a new investment and subsequently new contracts, do you know which properties are more likely to pay off? Here are some of the best investments, noted as such for their pricing, income potential and the types of tenants that they tend to attract.
Apartment buildings, according to Forbes, constitute as low risk properties. With the high price of homes, young people are more likely to rent than buy. Likewise, older adults like the convenience of rentals above home maintenance. Low-risk properties are those that almost always provide passive income to owners. However, it is important to note that apartment buildings do take a lot of work to maintain. The higher the rent, the more likely your tenants are to expect unrealistic maintenance and service.
Another commercial real estate investment with a high return is flex space. Flex space is an industrial space broken into showrooms and office units. When it comes to risk, these are some of the most low-risk options available because small businesses are almost always in need of space. Consequently, they also tend to be meticulous about paying rent on time every time.
For commercial real estate that does well during high and low times, self-storage is another option for investors. As a bonus, self-storage requires the least amount of maintenance. When one tenant moves out, all you have to do is sweep the unit and provide space for a new one. The biggest downfall of self-storage facilities is that the industry is highly competitive.