commercial real estate basics

5 Tips for New Investors in Commercial Real Estate

Diversify your portfolio with larger assets

By Perfect Skip, August 6, 2021

You've been dreaming about it for a while now. You want to make the leap into commercial real estate investing, but you're not sure where to start.


Well, have no fear! We're here with 5 tips that will help you get started on your journey as a new investor in the commercial real estate business.


  • Understand the risk and reward dynamics commercial property offers. You'll want to get a good understanding of the cap rate, and how it was calculated. Comparing revenue against the costs required to operate the building determines how much cash flow you'd be getting.


  • Develop an investment strategy that suits you before you invest your money. Never put any money down until you know the parameters of the investment. Have a seasoned investor in this asset class give you feedback to see if it's a deal or not.


  • Invest only what you can afford to lose completely so that if things go wrong, the loss will not affect your finances too much. And that also goes for lenders and any other type of creative financing.


  • Have patience because timing is crucial when it comes to commercial properties – do not expect quick results from these investments (think decades); and finally,


  • Seek professional advice where necessary but also learn as much about commercial property investment as possible. Large asset classes required a larger amount of due diligence.


As you can see, it’s not as difficult as you thought to get started in the commercial real estate investing business. All that is needed are some of your own funds and a willingness to learn. But if those two things seem daunting for now, don't worry!


We're here with 5 tips to help you make the transition from home buyer or seller into a successful investor in no time at all. Schedule your consultation with one of our experts today! Let's strategize together.


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