Commercial real estate has the potential to provide significant returns to investors, often with fewer risks than residential rental properties. With commercial real estate investing, you own a property leased for retail or business purposes, such as a restaurant, apartment building, or office building. There are several types of commercial properties, including multi-family, office, retail, industrial, and special-purpose properties. Before adding a commercial property to your portfolio, investors can benefit from knowledge about how to invest and what properties best serve their needs. In this article, we’ll explore what you need to know about commercial real estate investing, especially in a mid-sized market like Western Colorado.
Owning and Managing Commercial Real Estate
Since most commercial properties have multiple units, they often provide larger and more stable returns than single-family residential properties. Making the profit margins even more attractive, most commercial property owners hand off the costs of property taxes, maintenance, and insurance to the tenants. Despite generating more money, however, commercial properties may require more money upfront. Investors need to supply a larger down payment and usually prove projected income to qualify for a loan. Investors can turn these challenges into opportunities by looking for properties that accommodate a high number of tenants, such as commercial apartment buildings, office spaces, retail stores, or industrial buildings.
Ensure Your Investment Supports The Area’s Needs
Researching the area’s economy can help you invest in properties that people will use, which is another way to guarantee returns on your commercial real estate investment. While an apartment complex may be a great commercial investment in a quickly growing city, it might not make sense for an area with a smaller, steady population. Despite heading into a recession, in 2022, the following industries in Delta County grew substantially: Construction, Manufacturing, Finance and Insurance, Accommodation and Food Services, Agriculture, Forestry, Fishing, and Hunting. Therefore, if you’re looking for a commercial investment in the Delta County real estate market, office buildings, restaurants, and recreational land are attractive options.
Commercial Can Be Creative
Even if you’re not ready to pull the trigger on a commercial real estate investment, you can still get creative about making money off your property. If you own a home, you can make it a rental property, capitalizing on the short-term or long-term rental markets in your areas. For more information about this, check out my other blog post, “3 Tips For Listing Your House For Rent in Colorado.” Furthermore, if you own land, you can consider renting it to local farmers who need more space to grow crops or raise livestock. Finally, if you want to invest in commercial real estate but don’t have the funds to purchase a building outright, many online investing platforms allow you to passively invest in a small percentage of a commercial project.
Commercial Delta County Real Estate
The Delta County Real Estate market is a great way to get your foot in the door of commercial real estate investing on a smaller scale. There are fewer barriers to entry, less competition, and several unique economic factors that can help you generate returns right away. Just do your research and make sure there’s a need for the property type to want to purchase.
To learn more about commercial real estate opportunities in Western Colorado, call me at 970-986-2955 or email me at rob@coloradocountrybroker.com.
