Commercial Real Estate Makes a Good Investment

REITs allow like-minded investors to collaborate in order to aggregate assets, and are one of the reasons why real estate itself has come to be regarded as a fourth class of asset (the other three are stocks, bonds and cash). Commercial real estate is a main focus of this kind of investment.
Although REITs have consistently outperformed many other investment vehicles over the past decade, it pays to be cautious before making an investment. Some REITs are publicly traded, and therefore face significant risk on the stock Marketing Companies For Real Estate Agents market. On the other hand, private REITs are not exposed to daily price fluctuations outside of their control, and instead can focus all of their efforts on increasing profitability by improving the offering of the property itself.
In Canada, these trusts typical allow investors to pool their funds to manage and buy bricks and mortar assets such as residential, industrial, or commercial real estate. Compared to many other investments, this investment in actual, physical properties means that there is significantly much less risk. The “one vehicle for all” model of a private syndicate means that when investors pool their resources they can diversify their assets and once again reduce risk.
Properties are usually diversified according to location, type, and how they are used. Revenue comes from rents for these leased properties, as well as value-added services. A key characteristic of a REIT management team is constant attention to improving the value and therefore the profitability of the lease space, as well as the ability to sign tenants for long leases, which also reduce the risk of this investment. A prime example Living In House For Sale of this in a real estate investing Canada context is the recent purchase of Zellers by an American investor. Zellers holds many attractive long-term leases at many properties across Canada. While this made Zellers an ideal target for a foreign purchaser, the REITs that manage the properties benefited from a major tenant locked into a longterm relationship. The investors, of course, are the ones who benefited in the end.
REITs can provide higher returns and lower risk at the same time in order to provide investors with income and growth.

READ  Real Estate, a Confidence Game