Investing in property is how some Australians boost their cash flow. However, having the deposit to buy property that isn’t your primary place of residence is one thing, knowing how to manage an investment property is another.
While many landlords choose residential property investment, others look to make an investment on commercial properties.
Want to know more about commercial property investment and management?
Read more from the Perth property team at Pro Property Group to find out.
What is commercial property?
Commercial properties come in a range of different shapes, sizes, titles and purposes.
Let a Perth property management team walk you through the most common ones:
- Standalone offices,
- Strata offices (where individuals or businesses own separate lots within a property and share ownership of common property),
- Medical centres,
- Retail,
- Restaurants,
- Mixed use (i.e. a warehouse and office on the one site),
- Industrial (i.e. factories),
- Boutique (i.e. car lots), and
- Commercial (i.e. warehouses)
Interested in investing in one or a combination of the above? Read more to find out the potential benefits and drawbacks of investing in commercial property.
What are the benefits of commercial property investment?
Essentially, investing in commercial property offers plenty of attractive benefits. The team at Pro Property Group, experts in commercial property management have listed them below:
- Increased rental yields
According to CoreLogic, Perth houses currently offer a median gross yield of 4.3% as of 2020. Commercial properties on the other hand, embrace a rental yield of at least 5% to 10% on average.
- Longer lease terms
A 3-year commercial property lease is considered short. 5-10-year leases are more common.
- Regular rental increases
Usually, rental increases occur annually for commercial properties. This can really add up!
- More sit back and relax
What does this mean? It means the lessee is often responsible for the fit out and configuration of the commercial property for their use, tenants are more likely to pay the outgoings and there’s at often times, better upkeep and maintenance.
- Diversification in options
Owning multiple residential properties may make you more vulnerable to market swings. Commercial property ownership, however, often balances out these cycles in a portfolio.
Are all these benefits looking attractive? Contact Pro Property Group today and let’s find the best commercial property investment for you.
The potential drawbacks of commercial property investment
With any long-term investment comes risks.
Let’s take a look at the potential drawbacks below:
- Higher loan interest rates,
- Longer vacancy periods,
- More lease negotiations,
- Typically, longer to sell, and
- More sensitive to market cycles.
There’s more complexity involves in finance and investment in general, for commercial properties.
However, the reward you could reap, far exceeds the drawbacks you may experience.
Pro Property Group: commercial property management experts
At Pro Property Group, we specialise in helping individuals buy, sell or lease commercial properties.
If you’re interested in taking the leap into property investment or adding to your portfolio.
We have the professional property solutions for you.
Ready to invest in commercial property?
Contact Pro Property Group today for the property management you need for return on investment.