Unlike residential property, which is limited to structures used by homeowners or renters for living purposes, EST for commercial property includes any building not intended for human habitation. It can be an office building rented to white-collar employees, a retail structure like a mall or a warehouse used for industrial operations. It can even include a hotel or medical facility.
What is an example of a commercial estate?
When buying commercial property, it’s important to understand the different types to make a wise investment and avoid costly mistakes. It’s also good to have a general understanding of how each property type can be used to generate income, such as by leasing offices or stores, or storing goods, like in a warehouse.
Commercial real estate is generally more expensive than residential properties, and it’s at greater risk from economic downturns. It can be harder to finance and may require a higher down payment or credit score. And it’s often subject to higher vacancy rates, making the income stream more volatile.
Investing in commercial property can offer a number of benefits, including high returns and tax advantages. It’s also a great way to diversify a portfolio, and there are many different ways to invest.
The six main types of commercial property are multifamily, office space, retail, warehouses, medical offices and special purpose buildings. Multifamily properties include duplexes, garden apartments and condos, while office spaces are low-, mid- or high-rise buildings rented to professionals or organizations. Warehouses store large volumes of goods and materials. Medical offices house outpatient facilities and clinics, while cold storage is refrigerated industrial property used to keep items like food or medicine at a safe temperature.