For those looking to get started in real estate investment, residential real estate can seem like a good start—primarily due to the familiarity. But the commercial real estate Eugene sector can offer many advantages, as this article clearly articulates:
Why You Should Invest Commercially Instead of in the Residential Sector Every property investor eventually tackles the same question – should I put my money in a commercial building or on the residential side? It can be easy to opt for the residential niche, after all you probably know a handful of people that are […]
The Major Advantages to Investing in Commercial Real Investment
As experts in commercial real estate Eugene, we have counseled numerous clients on the advantages to be found in commercial sector of real estate investment. One key advantage is the lack of turnover and downtime. Most residential leases are one-year leases, sometimes even less. But commercial leases usually run for three to five years. That amounts to significantly less tenant turnover. Despite the lease length, however, some leases may increase rental price over the course of the lease (another great advantage over residential real estate investment):
Commercial property owners can offer new tenants free or discounted rent the first few months as they prepare the building and get their feet wet. In return, they may sign a “ratchet clause” in which rent will then rise annually. If a business becomes successful, they will want to stay at their location and should be willing (and able) to pay for that opportunity.
Commercial tenants will often improve the space they’re renting in order to better attract and serve their customers. The tenants themselves pay for these improvements, and when the lease ends, those upgrades generally stay in place, potentially allowing you to charge more to the next tenant for the improved space.
Perhaps one of the greatest advantages to renting to a commercial tenant is that commercial tenants tend to take care of the property they’re renting. No business is served by operating out of a property that poorly represents them to their customers. That motivation disappears on the residential side.
The professionals at Pacwest Commercial Real Estate are experts in commercial real estate Eugene. We’re here to help you find the right property to meet your investment goals, and to guide you through the process. You can reach us at 541-912-6583.