Rule Book for Commercial Real Estate Investment

Are you looking to channelize your money in a commercial property? If yes, it is necessary to keep in mind that investing in commercial real estate is quite different from putting money into a residential property. By making a sound investment, you can expect to yield higher returns in comparison to most debt instruments.

Whether you’re a NRI looking to invest in an upcoming commercial property or an investor looking to yield higher ROI out of your investment, taking the right decision is very crucial right from the beginning.

To make it easier for you making commercial real estate investment, here are some crucial factors that need to be looked into. Let’s explore them below.

1. Location is everything

Commercial properties are meant to deliver returns through two channels— rent and capital appreciation. Both of them depend heavily on the location aspect. Browse through locations where vacancy is less than 5%. This simply means that supply is proper and tenants are less expected to vacate, ensuring better rents and capital appreciation. Always look for locations that have been experiencing fast infrastructure development. For example, there are various locations in Noida and Gurgaon that have been witnessing tremendous infrastructure development nowadays.

2. Act like a professional

For all investors searching for commercial real estate opportunities in Delhi-NCR, there are seasoned experts who are fluent in the field of the business. When you start approaching like these investors, you immensely increase your likelihood of commercial real estate success. The better conversant you are the easier it becomes to make more constructive and worthy decisions. Here are a few key points you should know if you are seeing this property:

• It is necessary to keep in mind that the value of a commercial real estate property is directly associated with the usable square footage that is ready for use within the space. This is not necessarily evident in residential real estate. Considering this, it becomes clear that multi-family dwellings such as apartment buildings or multi-unit retail spaces are set togive a higherROI on your primary investment.

• The extent of a lease will majorlyinfluence your cash flow as an investor. Commercial property leases are generally quite a bit lengthyas compared to residential leases, including another bonus to this type of investing.

• Always figure out what is expected from you from a cash stance. Commercial real estate investors are generally expected to attract a down payment of a minimum of 30% to the table.

• Keep a sharp eye! When looking for available properties, don’t forget to focus on damages that might need either instant repairs or costly repairs down the line. This can help you through the negotiation process or perhaps, even to avert making a primary investment in the first place.

3. Discover your options and decide on your budget

It is quite clear, especially when the market is flooded with a lot of commercial real estate investment opportunities. Commercial real estate is not restricted solely to retail or office space, but also encompasses apartments, warehouses, healthcare buildings, hotels, countryside, and industrial space, to name a few. Once you have decided which investment is ideal for you, decide on a viable budget and remain stick to it. For each property you gaze at, take into account your budget and your net operating income. This refers to all of the revenue and costs linked with a specific property.

In recent times, several commercial properties have emerged out in the NOIDA region that makes the promise of amazing returns in near future. Some of the leading ones are spectrum@metro. Before putting your hard-earned money in any of them, do pay consideration to all of the above points and cultivate great returns in future.