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Guide to Commercial Investment Property

Commercial Investment Property

Commercial investment property is any kind of property or building that is meant to generate some revenue, whether it is from the leasing or renting of the space, or revenue generated because of the type of business that occupies such property or building. Therefore, there are different types of commercial investment property.

One of the more common types of commercial investment property will be multi-family commercial real estate. This kind of commercial investment property includes duplex homes, condominiums, and similar types of housing units meant for more than one family. Commercial investment property in this category will usually depend on the leasing contracts and rent that tenants pay as its major source of revenue.

Retail space is another form of commercial investment property. These properties include buildings that are used as stores for consumer products, including malls, shopping centers, and similar types of complexes. Investment yields are usually determined by other factors and calculations in addition to rent and lease revenue.

Calculations are sometime based on the size and value of the land, and the actual retail sales per square foot. In certain cases, depending on the nature of the contracts, commercial property loans and interest rates may also play a factor in the investment return calculations.

Office buildings and complexes are another resourceful commercial investment property. These buildings will usually be rented out or leased to businesses, and most of the revenue is generated from such contracts. However, square footage, land value, and location will also factor into the revenue return of the investment.

NEXT: What Will Commercial Property Insurance Do?

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