The market is ripe with opportunity for the smart investor right now, despite the turbulence of trade wars and the possibility of a downturn in the next few years. We have been relatively lucky after the massive crash from a decade ago. Right now we are in one of the longest periods of economic growth in U.S. history and savvy investors are taking notice. Could this be the best time for business owners to invest in commercial real estate? It just might be the most optimal time in history to diversify your portfolio, take advantage of the future equity of an owned property and start making some income from other tenants. Here are some reasons why now might be the best time to invest in commercial real estate.
Rates Are Rarely This Low
Commercial real estate loan rates are at some all-time lows right now, which means that many business owners with a strong corner of their own market can get into a business loan program at a rate they never could have taken advantage of before. This means that businesses that stimulate the economy have the opportunity to put down some roots and become a fixture for their customers.
Diversify Your Portfolio
As the buoyant stock market has risen, its caused some investors to need to reallocate the funds in their retirement savings. You can invest in commercial real estate investments to diversify your portfolio. Traditionally, real estate is a great investment strategy and commercial real estate opportunities, while they tend to cost more initially, usually hold a lot of value as opposed to the residential investments that could be costly to any owner
Eliminate Rent Payments
You get into a mortgage to “stop paying someone else’s mortgage,” so why would you choose not to earn equity on a property where you do business? After all, rent is one of your biggest expenses next to salaries, so it makes sense to invest in commercial real estate, allowing you to build your wealth and give you control of the facility costs.
If you become the landlord of the building, you can earn an income from the other tenants in the building, which helps to ease the loan repayment process and might actually cover some other expenses too. If you’re lucky enough to not need a ton of financing, the leasing of property could be enough to operate as a stand alone operation or a separate division of your company.
Not Ready To Invest In Commercial Real Estate? Do This…
Here’s the thing: not everyone should go out and invest in commercial real estate. Owning property might not be the right choice for every business owner and that’s not always because of finances. Perhaps your customers are used to an area and it wouldn’t be optimal to move or you have different ideas for your business growth. This is perfectly fine! However, if you’re leasing, you might be missing out on the power that is contained in your lease. At LCI Realty, we empower our clients to recognize the significance of their lease and the negotiation power they have at their fingertips. Want to see what your lease is really worth to your landlord? Check this out: