There’s never being a better time to ask yourself – are you ready to start investing in commercial property?
The long-term prospects for the commercial property market are positive and while the market is cyclical and presently experiencing a downturn, opportunities abound for smart investors looking at commercial properties for sale.
For buyers prepared to think outside the box, an investment in commercial property can be resilient to economic downturn. Here are a few questions to ask yourself to see if you are ready to start investing in the commercial property market (visit www.proplist.com).
* Are you open to investing in the industrial sector? The industrial sector comes in all shapes and sizes. It is the most robust sector of the commercial property market generating rental returns of approximately 4%. Investment in this sector of the market continues to grow strongly, suggesting confidence.
* The retail sector is the worst performing sector of the commercial property market. There are many reasons for this but when there is a degree of consumer uncertainty, retail is one of the sectors that suffers. But smart investors are looking at the retail sector when surveying commercial properties for sale because they can be re-purposed. High street properties can be re-purposed into housing or services (i.e. a gym). Some suggestions for re-purposing retail properties can be found at https://www.bbc.com/news/business-43699263.
* Be open to shorter leases. Most investors love a long term, reliable tenant but they are becoming harder to secure. This requires a shift in the mindset of commercial property buyers. Short and flexible leases are very attractive to tenants, especially start-up tenants. Retail pop up shops are an example of this kind of flexibility. One benefit is that weekly rentals returns tends to be higher for shorter leases than long leases.
* The rise of shared workspaces shows no sign of abating. Shared workspaces, like those you can find from businesses such as https://www.wework.com/en-ZA/l/united-kingdom are fundamentally different from the traditional serviced office model and are a growth market in the commercial property market, offering opportunities for buyers looking at commercial properties for sale, particularly in the office sector. One of the attractions of shared workspaces is that they are often in non-traditional workspaces – re-purposing of retail and industrial spaces is common in this market.
* Everyone is talking about Brexit, but Brexit represents as many opportunities as threats. The pound is down, making UK property more attractive to overseas investors. Brexit will mean new trade agreements can be negotiated, stimulating growth in the medium and long term. In addition, the UK is renowned around the world for its robust economic, legal and financial systems, making investing in the UK a highly desired option for many.
If you are open to adapting your thinking when looking at commercial properties in the UK there can be benefits. Investments in commercial property can be a rollercoaster ride but if you are prepared to strap in you may be ready to invest in the commercial property market.