Commercial Property – The Three Types

Mention the word property and most people immediately think of personal real estate such as the home they live in. There is, however, a second category of property out there known as commercial real estate and it has been in the news lately as the economic problems have spread to it as well.



Commercial property is often referred to as business property. You probably visit a structure of this sort at least once a day. It is a type of property that is very unique and important because it is a very accurate gauge of how our economy is doing. This is because it is affected by the number of people that are working, the growth of the economy and the health of the banks. When any of these factors have problems, it shows up in empty stores like we are seeing now.



The first type of commercial property is generally considered the multifamily unit. Put in more simple terms, we are primarily talking about apartments. The definition, however, can also include duplexes and other structures where multiple rentals are occurring. Multifamily properties tend to be fairly sold investments in good times and bad as people always need a place to live.



Retail stores are our second type of commercial properties. They range from small and hug malls to the local stores in your neighborhood. These stores are very indicative of the overall health of the economy. When people are out of work, these stores start failing. One needs only look around at all the empty store spaces in the malls to know things are tough now.



Office buildings are the third form of property. These properties are more stable than we see with retail properties. As such, they are an indicator of whether an economic problem is a minor glitch or something major. Given all the empty and open office spaces these days, you can tell the Great Recession and "recovery" has been a real dozy.



Commercial real estate is often given little thought as an investment focus by most people. This is a mistake. It can be a huge money maker. The key is to understand the types and how to do the investing. If you get that right, you can position yourself to make a ton of money over time. The current recession has been brutal, but it has also created a ton of opportunities given the low prices. This presents you with an opportunity to buy a steal of a deal, so don’t let it go by.



Thomas Ajava writes for CommercialApartmentLoan.com - your only resource for commercial apartment loan financing in any market.