Is Investment in Commercial property Worthy or Not?

What is a commercial property?

It may refer to Retail Spaces, Office Spaces, and warehouses, industrial buildings, mixed-use land. However, even when the economy is strong, the commercial Property eventually holds its grip on the growth in value and provides you with a steady income.
Investments in commercial property and residential property are two completely different scenarios. There are pros and cons of both the investments and it is necessary to look into each and every minor to the major point before taking the decision to invest in real estate. The main consideration of this is to get the buyers out of the confusion that is an investment in commercial property worthy??
Let’s try to figure out this by looking at the pros of commercial property investment. Those of you starting out and have confusion regarding the investment in commercial property …then, here’s a list of the benefits you’ll enjoy from successful Commercial property investing.

Pros of commercial property investment

Benefit #1: Strong Rental Yield
The biggest plus point of Commercial property is that they generally provide a higher return on investment (ROI) compared to residential properties. The average rental yield of commercial property depends on the type of commercial property like retail shop, office spaces, business spaces; etc tends to be in two digits i.e. 10%. The rentals fetched can also be high if the location of the property is premium or good, it can even go up to 13% to 15%. Commercial Property can favor you with the income as well as capital growth which is strong and reliable. For example: “BHUTANI CYBERTHUM” in Noida offers 12% of assured returns.

Benefit #2: Longer lease period:
The commercial properties have a longer lease period which ranges from 3 to 10 years. The tenants for commercial property do not switch in short durations.
Usually a lease for commercial property is signed for minimum of 5 years which gives assured returns and fixed income for the owner. The lease agreement carries a legal guideline of annual increment irrespective of market conditions. For example: “BHUTANI CYBERTHUM” in Noida offers lease guarantee.

Benefit #3: Cost of furnishing is negligible:
One of the key advantages of commercial property investment is that Cost of furnishing is negligible. Providing tenants with raw units and then tenants modifies the property as per their requirement thus reducing the cost for you. The corporate, banks, business houses or retail chains furnishes the property as per their branding and guidelines to maintain the status.

Benefit #4: Assured Income
Commercial property generally have long term lease period than the residential property which ranges from 3 to 10 years that in turn have brings security of income. This is one of the main points that buyers should invest in commercial than the residential property.

Benefit #5: Tenants:
Quality of tenants is very important as they tend to attract other tenants in the nearby location. If the location is good and approachable then the rental expected is high. Usually tenants are corporates, banks, business houses or retail chains and they are considered to be good as you need not have to run for rent and other operational hassles before them.

Benefit #6: Stability of the price:
Commercial properties as compared to others investment types have lower level of impact and fluctuation on their price.

Benefit #7: Less risk against Inflation:
Commercial property prices rises over time as it tends to have valuations that are determined by the level of rent paid. And under commercial property the rent inflation increases the rent. As the trend shows, Commercial property has always been viewed as a good hedge against inflation. Inflation over a long period of time can be outpaced by the Commercial Property .

Benefit #8: Lower Risk
If we talk about commercial property, then investment in Commercial property is less prone to risk than the residential property or the stock market.

Benefit #9: Tax Benefits
Commercial property provides you with the tax benefits in different ways. There are building allowances, some depreciation benefits and many more….

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