Commercial Purpose - For Your Best Choice

1. Stable and secured investment

• Commercial real estate for lease investors ensure steady cash flow
• Commercial land as commercial purpose on GST Road real estate gives more income steadily as compared to shares, stocks and other bonds.
• Steady cash flow is very helpful in Commercial real estate investments.
• This kind of Income stability can keep investors stress-free.
• The commercial real estate market is not affected directly due to a dull financial market.
• And particularly at the time, the financial market was volatile.
• Commercial lease agreements are long-term in nature. Unlike residential real estate, commercial properties provide regular income.
• Besides this, the provision of the annual increase in the agreement ensures a high and consistent return throughout the year.
• The site selection should be perfect. If we buy plots in Chennai as commercial property in the right location, it will keep the safety and prevent the loss of cash inflow even during times when they don’t have tenants occupying their properties.
• So, it is the safest and most secure type of real estate investment.

2. Net lease options

• A Commercial property owner has the option of signing a single-, double-, or triple-net lease agreement with the tenants.
• This offers the owner the flexibility in accruing operational or maintenance costs from the tenants.
• Out of all types, the triple-net lease ( NNN ) is the most beneficial for landlords as the tenants have to pay rent and bear the majority of expenses.

3. Equity

• Equity is the amount of value an investor has built up over a period of time.
• For commercial purpose real estate investment, the investor can build equity quickly with steady and relatively high returns.

4. Easy management

• Usually, big corporations or institutions like Banks, Retail Outlets, IT Companies etc… pay the rent for the spaces regularly.
• Since these entities are highly professional and always maintain business ethics. So, it becomes easier for a commercial property owner to deal with the tenant’s commercial land.

5. Less expenditure on furnishing

• Starting from hotels and restaurants to banks and saloons, every business wants to design and furnish their commercial units as per their needs and requirements.
• This allows you to offer raw and unfurnished units to tenants, thereby making your commercial property investment less with less amount spent on furnishing and interior designing.
• So, you have to invest a lot of money and also your time in furnishing the spaces.

6. Leverage

• The possibility to buy an asset without having to pay fully provides profitability to the investors.
• It increases their leverage resulting in higher gains compared to other asset types. This is a major advantage.
• The opportunity to use mortgage and downpayment helps the investors to avoid the burden of full payment at a time and to adopt term payments.

7. Value appreciation

• The commercial purpose gets appreciation in value and this leads to significant benefits.
• The commercial land investment in a premium location with new developments will be financially beneficial.
• For example, if our commercial property is stationed in a Metropolitan City. And a proposal has been accepted by the Government to construct a new Metro line and an example near our property location. Then, the return is very high and unimaginable.
• Making cost-effective improvements and adopting Proactive management can improve the desirability of the asset.
• Commercial real estate properties always offer excellent appreciation values.
• With the excellent socio-physical infrastructure, the value of a property is bound to appreciate well.

8. Good rental yield

• We can expect a rental yield anywhere between 6 – 8 % of the property value for a good commercial property.
• The rental yield is the percentage of the annual earnings generated from income-generating assets.
• Even Though the total return depends on many factors like the types of units and location, the profits can be in double digits for a premium location.

9. Quality

• Commercial properties involve much financial investment.
• One can offer it in terms of loans and other funds.
• The commercial land at posh and swanky places with advanced amenities bring more opportunities for business.
• These premium types of commercial properties always cost more.