Getting into commercial real estate can be tough especially if you want to get into the investing side of the business. Here are a few tips to help make your journey to success easier.
Be Focused and Have Patience. Investing of any kind is a marathon, not a sprint. Take the time to look into what kind of investment opportunities exist and which ones you would be interested in. Work on one project at a time, master it and then move on to the next project.
Secure Financing. Investing in commercial real estate comes with a substantial financial investment. Loans require a large down payment and the cost of rehab can be unpredictable. There are opportunities to invest in commercial real estate without being the sole financier (e.g., REITs, limited partnerships, and crowdfunding).
Do Your Due Diligence. It’s your responsibility to make sure that your investment is a good investment. That includes personally going over the physical inspection, financial review, legal inquiries, and necessary demographics even if you are working with a CRE expert or broker.
You should have all of the information and research on the vacancy rates of the area, approximate rental price, length of leases, and the economic status and job market in the area. If the area you’re investing in is growing you should know if that, if it is declining, you should know that as well.
Protect Yourself and Your Assets. Investing in commercial real estate comes with a higher risk of lawsuits. Putting a business between you and your investments, by forming an LLC or other business entity for your investment portfolio, can help protect your personal assets.
Don’t Forget About Property Management. If you are leasing out any kind of investment space, someone has to maintain the property and work with the tenants. While it can be you, it’s a good idea to hire someone or a company that specializes in and knows the laws pertaining to property management.
Contact Capital Crown Investments today to see how we can help you along your journey to commercial real estate success.