Investing in Commercial Real Estate
Investing in Commercial Real Estate
When most people think of real estate investment, they think of rental homes and apartments. However, current economic conditions make rental real estate riskier than ever. Even good honest tenants are subject to losing their jobs and being unable to pay rent. Furthermore, declining property values and rising taxes and insurance negatively impact profit potential.
Commercial real estate investment offers an attractive alternative to residential real estate. Leases are long-term and the checks are less likely to bounce. There are two basic types of commercial real estate investments: direct and indirect.
Understanding Commercial Real Estate Leases
Understanding Commercial Real Estate Leases
One of the most important aspects of managing commercial real estate includes understanding leases. There are a variety of leases employed by landlords to manage their tenants, and it is necessary whether you are leasing or renting a commercial space that you completely understand the agreement (lease) that you are signing.
A lease is like a partnership. It outlines how the business relationship between the lessor and the leasee will proceed. Following are some types of commercial leases that you, as an investor, may encounter.