Brian Fielding of Fielding Investments has always maintained that one of the best moves that anyone can make to secure a steady stream of income is to invest in commercial real estate. While many people feel that investing in residential real estate is the answer, Brian Fielding is sharing this information about the different challenges and advantages each investment presents.
- Initial investment
When it comes to investing in commercial real estate, it is important to note that not every bank will work with commercial real estate investments. Most major lenders will, but they will most likely want a larger down payment than would normally be required for an investment in a residential property. Brian Fielding shares that for a commercial property, a down payment of 30 percent or more is usually required; much higher than what it would be for an investment in residential real estate.
- Duration of the lease
When investing in residential real estate, the time that the lessor is on the property can range from several months to several years. While this can be a steady cash flow for the duration of the lease, finding another tenant can be a long and arduous process. However, commercial real estate leases generally have a longer duration of a tenancy. In fact, in triple-net leases, the term of the lease is usually for 15 years or more, providing a much more stable and reliable cash flow reveals commercial real estate advisor Brian Fielding.
- Increased cash flow
Besides having longer leases, which will automatically help the stability of the investor’s cash flow, commercial real estate investment also offers another perk. Because there are more tenants in a multi-unit commercial property than there are in a single-family household, the amount of money that an investor will collect is increased as well.
- Diversified risk to an investor’s portfolio
When investing in residential real estate, losing a tenant can be devastating because there is only one tenant to collect monthly rent from. Brian Fielding of Fielding Investments shares that because of the multi-unit nature of most commercial real estate investments, losing one or two tenants will not be as much as a problem as it would be to a residential real estate investor. Therefore, investing in commercial real estate helps to diversify the risk in an investor’s portfolio.
For more information and tips on investing in commercial real estate today, visit property investment advisor Brian Fielding’s website at http://brianfielding.com.