Frank X Acocella, CounselPro Lending, on Commercial Real Estate

The commercial real estate industry is one of the most lucrative sectors someone can invest in. Studies have shown that since 2000, investments in the commercial real estate industry have experienced an exponential rise. The wave of enthusiasm in investments in the sector is owed to the various benefits of investing in the industry.

Regular Income

Investing in the commercial real estate sector gives an investor the opportunity to experience a steady stream of regular income from the various leases and contracts with tenants. Besides, the commercial real estate investment rates are generally higher than the residential real estate rates. This gives the investor an opportunity to gain more yields and profits.

Better Appreciation Rates

Appreciation in the value of real estate properties occurs at a relatively steady rate. Historical analysis has shown that commercial real estate properties appreciate much faster than any other investment in the market. This makes such investments more appealing as the investor’s assets would be guaranteed to offer increasing returns on an annual basis.

The Ability to Obtain Leverage

Leverage in investment is crucial and influences the choice for investment options. Commercial real estate properties offer the most suitable leverage in the market today. This implies that an investor can incur debt in the form of a loan easier and more securely.

Taxation Benefits

Commercial real estate properties attract a huge wealth of taxation benefits. One of the core benefits in this sector is the mortgage interest deduction where investors pay a reduced taxation rate owing to mortgages payable. Another tax deduction is the depreciation deduction were investors in the real estate industry get to pay a progressively decreasing taxation rate owing to property depreciation with time. Such tax cuts come in handy in putting more money in the pockets of commercial real estate investors.

Suitable Opportunity for Diversification

Diversity in investment is crucial as it guarantees sufficient mitigation of risks while ensuring a steady rate of income. The commercial real estate industry offers a sufficient and reasonable level of diversification from common investment opportunities such as stocks and bonds. It is also a great platform to invest one's savings without the need to worry about the risk of losses. Investing in the commercial real estate industry, therefore, offers undeniable benefits to investors.