Commercial properties are designed and zoned specifically for business use and are often owned by commercial real estate investors who manage the property as a source of income. Buying and selling commercial property is entirely different than residential real estate transactions, but if you’re looking to diversify your investment portfolio, it can be a lucrative option.

What Is Commercial Real Estate?

Commercial real estate is any property that is used for business purposes, rather than residential or industrial uses. Some commercial real estate does overlap with residential, such as apartment buildings, but unlike a single-family home purchased by an individual to serve as a residence, commercial properties are purchased with the explicit purpose of generating income. This includes buildings and land.

Commercial real estate is typically more expensive than residential real estate because of the income-earning potential, especially in areas with high demand. Often, commercial properties are purchased by groups of investors or management companies because the prices are higher than residential ones.

What Type of Properties Are Commercial?

Commercial real estate encompasses a variety of property types, but what they all have in common is that they generate profits. This might include:

• Apartment buildings
• Retail space, including shopping malls and standalone shops
• Medical centers
• Restaurant space
• Office space

Commercial real estate also includes land zoned for commercial uses. For instance, a parcel of land sold to a developer who plans to build new housing units is considered commercial real estate. 

Why Should You Invest in This Type of Real Estate? 

Unlike stocks and bonds, where the value is determined by how much they sell for, real estate is considered a hard asset. In other words, where a stock is typically purchased at a low price with the intention of selling it for a profit when the price increases, real estate is purchased for its income potential.

Because real estate can earn money from operations—such as rent or revenue from sales in a mall—and appreciation, it’s often seen as a less risky investment. It’s sought after because of its potential for stable, significant cash flow. 

If you’re interested in a commercial real estate investment, the professionals at Veritas Realty Group can help you find the right property for you. Serving clients across Williamson County, TN, area for more than 20 years, these experienced real estate professionals will help you navigate the process of buying and selling property, including managing marketing, legal concerns, and pricing help. To get started, call (615) 620-4700 or visit them online to see their listed properties.