Why Investors are Moving Toward Commercial Properties in 2018

Commercial real estate financing is doing booming business right now, and one of the reasons for this is that investors all over the country are turning their sites to commercial property investments. In fact, property is currently the second most popular type of investment, second only to assets like cash and gold.

Moreover, the trend toward investing in property is only expected to continue, and today we’ll discuss why investors are increasingly turning toward commercial properties in 2018.

Commercial real estate opens a number of different doors

Commercial real estate investment opportunities are vast, mainly because there are so many different types of properties that fall into the category, including:

  • Residential buildings with five or more units

  • Hotels

  • Retail stores

  • Office buildings

  • Medical centers

  • Warehouses

  • Industrial properties

Moreover, each of these different property types comes with a different model, and they each have varying outlooks for the years to come. For instance, if you were to invest in a warehouse, the outlook for the property would likely be good because the logistics sector is forecasted to continue performing well in the coming years.

Similarly, the rapidly aging population also means there's likely going to be an increase in demand for medical services over the next several years, which mean medical property investments could have great potential.

Rent is always increasing

They say nothing in life is certain but death and taxes, but they overlooked another contender: that rent will always go up. Even though there are fluctuations and dips here and there over the years, the overall trend is that rent is increasing, and that means there's an increased potential for rental income with any commercial property.

There's a better opportunity for high-yield returns

The outlook for traditional financial investments is always tied to interest rates, and at the moment, many of these are offering low returns. Commercial real estate, on the other hand, offers a number of opportunities for high yields, because there are a number of ways you can generate income with commercial properties.

One of the most common is through rental income, but you can also make money with fees for services rendered, through various advertising opportunities, and thanks to appreciating property values.

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Already have an commercial real estate investment in mind? Contact us today to discuss your lending options or get an application started for your commercial loan.