Commercial Real Estate
Commercial real estate is one of the two most common types of real estate. The other being residential real estate. Commercial real estate are properties that are used exclusively for business purposes and that generate income. Some refer to it as commercial property. The most common forms of commercial real estate are retail, office space, multi-family housing, and industrial space.
Retail
Retail commercial real estate consists of many different types of retail centers. The one that comes to mind most are big box retailers like Wal-Mart and Lowes. These retailers stand-alone but typically have fast food restaurants or smaller retail strip centers nearby.
Companies like Target and Academy are usually found within a strip center, connected to other, smaller shops. Nail salons, pool supply stores, and smaller well-known retailers are found within this type of commercial real estate. Malls are another example of retail commercial real estate. Large shopping malls consist of what are called “anchor stores” like Macy’s, J.C. Penny, or Neiman Marcus.
Anchor stores are department stores that are nationally recognized and attract shoppers. These shoppers then explore the rest of the mall and visit the lesser-known shops. Malls also house food courts, which rent out their space to various restaurants. Restaurants are another type of retail real estate. Restaurateurs purchase retail property and build their restaurants for the publics consumption. Grocery store chains and pharmacies are also retail properties.
Learn More,
Office Space
Office space is another kind of commercial real estate. Office space is used for businesses promoting many different kinds of services. This can include medical offices, banks, art galleries, investment firms, or start ups. For comparison purposes, these properties can be broken down into three different classes. Class A, Class B, and Class C.
Class A office space is the best of the best when it comes to office space. They are usually newly built and feature the most up to date and technologically advanced amenities. Purchasers and or renters will pay a premium for Class A office space. The space is usually in buildings that are front and center, located on main streets. Space is larger and ceiling height is higher. They typically have a lobby area to receive incoming guests and potential clients. Depending on if you are located in the city or a more rural area depends on what amenities these building will provide. The buildings that house Class A office space in the city will have conference rooms, fitness centers, convenience stores, food courts, dry cleaning, and coffee shops. Parking will be amply available to host both tenants and visitors.
Class B office space is just a step below Class A office space. These office spaces are located in buildings that aren’t as new as Class A buildings. They still have a lot to offer but don’t usually have the most up to date services and technology. The buildings still have excellent management groups and the tenants are good quality tenants. The price range for Class B office space is much more manageable and is about average as far as price for rental space goes. With the right property owner, Class B buildings can quickly be upgraded to Class A.
Class C office space is found in buildings that have not been well maintained. These buildings are often not located in the best part of town, making them less noticeable and harder to locate. There tend to be numerous office spaces for lease and at much lower rates then Class A, or Class office spaces. Class C office space is best for tenants who just need a short term lease or who do not have clientele that will need to meet with them.
Start Your business In The Right Location
Multi-Family / Apartments
Multi-family homes are great for multi-generational families that want to stay close to each other without having to buy multiple properties. Multi-family homes are also great for those considering investing in rental properties. It is a nice transition for those new to rental property ownership since you can live in one of the units, rent free depending on what rates you charge
Multi-family housing in the form of apartment complexes, townhomes, condominiums, and co-ops are a lucrative form of commercial real estate. The difference between residential multi-family real estate and commercial multi-family real estate is that the residential client is looking for a place to reside while the commercial client is looking for a property to make a profit off of.
Commercial multi-family housing also requires five or more units whereas residential can only have up to four units. There are turnkey multi-family housing options where the building is up to date, all rentals are filled, and the buyer is just changing the possession of the property into their name. Once possession is taken it is the buyer’s responsibility to maintain the property and keep the units full of renters. On the other hand there are fixer upper multi-family housing properties that need extensive work to get back into being profitable for their owners.
Industrial Space
Industrial space is any land and buildings that specialize in industrial undertakings. This includes such activities as manufacturing, warehousing, storage, production, distribution, and assembly. Depending on the use needed depends on the size of the industrial space. There are four typical types of industrial space. Light assembly, heavy manufacturing, bulk warehouse and flex warehouse.
Light assembly industrial space is utilized, more often then not, for product assembly and storage. These spaces can be reconfigured easily, making selling or leasing to new tenant simple.
Heavy manufacturing spaces are used mostly by large manufactures. They come extremely customized since they are originally built for a specific manufacturer. This makes them difficult to repurpose or renovate for another owner or leaser.
Bulk warehouse spaces are utilized for distribution of products and are very large in size. Convenient access by trucks is essential in bulk warehouses.
Flex warehouses on the other hand are commercial space that can house office space along with industrial space. This space is easy to convert to any service that may be needed of it.
