The best part about commercial real estate investments is that you get the option to engage according to your preference. If you want to be directly involved with the property, you can be the main contact person, otherwise, you can simply choose to give the handling of the property to an agent.

Ideally, once you earn some money from your first commercial real estate investment, it is better to invest in a few others to diversify your portfolio. This makes the option of being a passive investor incredibly convenient. Before listing the best commercial real estate properties for passive investors, let’s explore the benefits of being one.

Benefits of Passive Commercial Real Estate Investment

There are several benefits of being a passive investor in commercial real estate. Here are the most prominent ones:

1. Efficiency

Being a passive investor is efficient because it allows you to invest in multiple properties without having to spend a lot of time going over routine management for each of them.

2. Tangible Asset

Unlike stocks and bonds, commercial real estate is a tangible asset. Therefore, even in the event of economic fluctuations, you will always have the assurance of having full or partial ownership of a physical asset.

3. Reduced Risk

Due to both efficiency and having a tangible asset to back your investment, your risk will reduce substantially. A diverse portfolio of commercial real estate investments is always less risky.

Best Commercial Real Estate Properties for Passive Investors

If you want to be a passive investor, here are the best commercial real estate properties to invest in

1. Multifamily Units

Multiple tenants are better than single ones because the revenue does not depend on one party. Even if one family chooses to leave, the building will continue generating revenue.

2. Industrial Properties

Industrial properties are lucrative because it is customary for them to have a triple net lease and have higher rents. The type of lease is beneficial for you, as an investor, and the market rent income will give you a sizeable profit margin.

3. Office Buildings

Office buildings are generally Class A properties making them an extremely lucrative investment. Your dealing will also be with businesses instead of individuals, which will further add stability to your portfolio.

4. Retail Buildings

There are multiple benefits of investing in retail buildings like malls and shopping centers. Not only can you charge each business a basic rent, but you can also negotiate for a percentage of their monthly earnings to be added to the payment. Although they are expensive to invest in, they have a high ROI, making them worth it.

Conclusion

To sum up, the best commercial real estate properties for passive investors are leased to businesses, are secure, and have greater ROI. For residential options, it is always better to invest in multifamily units to spread out revenue generation.

If you want expert consultancy for your commercial real estate investment, please contact us now. Our team has years of experience in the field and will be happy to help you make the right choice.