Commercial real estate (CRE) isn’t just for big time developers or Wall Street moguls. It’s a powerful wealth building tool for everyday investors who want steady cash flow, long-term stability, and tangible assets. Whether you're eyeing a warehouse in New Hampshire or a retail strip in Massachusetts, here’s how to get started.
What Is Commercial Real Estate?
Commercial real estate refers to properties used for business purposes. These include:
• Office buildings (from small suites to corporate towers)
• Retail spaces (strip malls, standalone stores, shopping centers)
• Industrial properties (warehouses, manufacturing facilities, flex spaces)
• Hospitality (restaurants, hotels, rentals)
• Multifamily units (apartment buildings with 5+ units)
Each type has its own risk profile, tenant dynamics, and income potential.
Why Invest in Commercial Real Estate?
• Higher income potential: Commercial leases often yield more rent than residential ones.
• Longer lease terms: Tenants typically sign 3–10 year leases, offering stability.
• Diversification: CRE adds a physical asset class to your portfolio.
• Tax advantages: Depreciation and expense deductions can reduce taxable income.
How Do You Get Started? Below are some great starting points to get you on your way.
1. Define your investment goals: Are you looking for passive income, long-term appreciation, or a value-add project? Your goals will shape your strategy.
2. Choose your entry point: You can invest directly (buy a property), indirectly (REITs or syndications), or creatively (seller financing, lease options).
3. Understand the market: Research local zoning laws, vacancy rates, tenant demand, and economic trends.
4. Build your team: You’ll need to start with a commercial broker and a lender. A strong team helps you avoid costly mistakes.
5. Research, research, research! Start looking at properties, watch what they sell for, how long they are on the market and stay informed about what is going on in the area you are looking to invest in.
Common Pitfalls to Avoid
• Underestimating operating costs: Maintenance, taxes, and vacancies can eat into profits.
• Ignoring zoning and compliance: Always verify permitted uses and code requirements.
• Overleveraging: Don’t stretch your finances too thin. CRE is a long game.
Barb's Final Thoughts
Investing in commercial real estate is a journey, not a sprint. Start small, stay curious, and lean on experts who know your market. Whether you're buying your first mixed use building or exploring industrial assets, CRE offers a path to financial freedom, with the right strategy and support.
Call, text, or email if you want to discuss different options that could work for you!
