What is commercial real estate?

Commercial real estate in Ohio can be incredibly profitable. That’s because these types of assets have some earning potential that residential real estate doesn’t have. While you may be able to profit from selling residential properties, you can generate income while you own commercial real estate.

Any property that can generate profit for the owner through rental income or capital gain is considered commercial real estate. Here are some of the most common examples:

Multifamily

Any building that rents units to more than one family can be considered multifamily commercial real estate. This may include high-rise apartment buildings, smaller apartment buildings or condos. Owners of multifamily buildings may be able to generate a steady rental profit.

Retail

Retail properties could include all different types of businesses such as restaurants, supermarkets, banks and clothing stores. Some retail properties are single-use with one business as the tenant while others are large multi-tenant shopping centers. While large retail properties can be highly profitable, working with so many businesses at once might end up in real estate litigation.

Office

Like retail properties, offices can be rented out to a single tenant or multiple tenants. Office real estate is usually divided into urban or suburban categories. Urban office buildings may be located in the heart of downtown while suburban office buildings may be part of an office park on the edge of town.

Industrial

With so much demand for online retailers these days, industrial properties may be a great investment. A lot of industrial properties are built for storage and distribution while others are built for heavy manufacturing work.

Working with multiple tenants

It’s important to do a cost-benefit analysis before investing in anything. Commercial real estate can be a great investment with the potential for steady income. At the same time, large properties with multiple tenants can involve complex negotiations. However, many commercial real estate owners hire property management services to deal with leases and rent collection.