When it comes to investment property, there are several different types you can purchase. Read on to find all the sub categories included within the investment commercial property category and consider which type would best suit your business.
All categories of commercial property can provide yields for investors. Below, we group them into the most popular three broad sub categories. All these, along with other categories of commercial property, are covered in full elsewhere on MOVEHUT.
Offices have traditionally underpinned the commercial property investment market. Historically, this is because they have been let on long term leases and were widely viewed as a stable source of income.
Although leases have got shorter in recent years, offices are still hugely popular among commercial property investors.
Office space in the city of London has some of the highest rental values in the world. Consequently, London is the leading international destination for office investment with institutional and overseas investors dominating the market.
As well as the major business locations, you will also find office investment property in all locations throughout the UK.
The decline of manufacturing in the UK has not led to the kind of slump in the industrial property market that might have been expected. Instead, it is seen as something of a safe bet by investors.
This is because older industrial properties are a lot easier to let than older offices. In addition, there is a strong demand for warehouses for storage and distribution.
Location can be key when it comes to industrial and warehouse investment property. For example, if you find a building for sale in close proximity to major transport links, it will be easier to let out than a property where accessibility may be an issue.
Once again, location is crucial when it comes to choosing a commercial property investment in this sub category. If you’re considering a retail property as a potential investment, having a clear picture of the footfall in the vicinity will help you reach a decision. But this isn’t the only factor.
If you’re planning to invest in an occupied retail property, you should also consider the covenant of the tenant. If the shop is vacant, you should ask yourself how easy it would be to let, because an empty commercial property will earn you no income.
You should follow the same guidelines when it comes to leisure property. In addition, you should bear in mind that the success or failure of leisure businesses can depend on difficult to anticipate changing fashions and tastes.
Pubs and restaurants, in particular, pose a risk to investors in this respect as their continuing popularity can’t be taken for granted and you could be left looking for new tenants.
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