Understanding Commercial Properties for Rent

What’s commercial property?

Commercial property generally refers to all property that is not listed as residential. Commercial property may thus include office space, retail, multipurpose buildings, and industrial units amongst others. Perhaps an understanding of these various kinds of commercial properties is crucial. Basically, office space includes all those places available for use as offices. Retail space involves outlets that serve as stores, mostly standalone shops.
On the other hand, multipurpose properties combine both commercial and private uses.
This can be demonstrated by buildings that host both business premises on the lower floors and residential properties above. Industrial units refers to space that is meant for manufacturing. This generally includes space targeted for light or heavy industrial uses.  Industrial units may also include space meant for warehousing, research and development amongst other commercial industrial uses. Commercial property also includes other spaces such as hotels and motels. Each country has its own classification and zoning mechanisms for commercial properties.

Investing in commercial property

The rewards for investing in commercial property are attractive. But breaking into this line of investments can seem difficult if not impossible. All investors are profit seeking and want to invest in properties that bring in the returns fast and good. But unfortunately, this is not always the case! Investing in commercial property such as industrial units is a high risk game. Fortunately it is not as riskier as investing in residential property. For both of them, finances can be limiting. Investing in industrial units requires sufficient cash backing, but lending from banks isn’t as easy.

The lending criterion has been getting tougher by the years. But that doesn’t mean you can’t eventually secure a loan. After securing the finances, most often investors have to adopt a wait-and-see attitude with rates. This wait-and-see game can last for months, before you are ready to jump the gun! But of course all these can be overcome with some little bit of thorough planning. Investing in commercial property is really no different from investing in stocks or an idea. It is all about proper planning and timely execution.

Benefits of commercial property

As an owner of commercial property, for instance industrial units, the rental yield can be quite handful. Perhaps this is what differentiates residential property owners and commercial landlords. Commercial landlords take home a bigger chunk than residential property owners at the end of the month. Typically, rent from let units can be as high as 8 per cent of the capital value of the building! For long term superb yields, it is recommended that you only let to long term leasers.

The other advantage with commercial property is the fact that there is flexibility in renting arrangements. You can affordably let to major corporate or small businesses. Understanding commercial property basics is crucial to making informed investments. You can only invest better if you know what options you have in terms of the various commercial property types. But if running a business and looking to let, be sure to consider important factors such as location.

Harworth Estates are one of the largest landowners in the UK. They provide residential and commercial properties, office space, development land and industrial units to let.