Investing in commercial properties can offer significant benefits, but in order to ensure its profitability, an active approach to both investment and development is required.
Residential property investments are normally lower yielding and more predictable, while commercial investment and development tends to be less predictable and higher yielding.
Naturally within the commercial sector there are stable investments - for example, an office let to the government for 25 years. But there are also higher-risk options - such as a department store let to a high street retailer on a five-year deal.
Commercial property offers genuine opportunity for investors. The harder to asset-manage the investment or development, the greater the risk - but the higher the likely return on your commercial property purchase.
Investing in the UK commercial property market requires due diligence and a deep understanding of the various property types available, such as office space, retail property, industrial units, hospitality and warehousing, and underlying property values.
It's also crucial to consider factors like commercial law, corporation tax, energy costs, business rates, and planning permission that can impact the profitability of your investment.
