To put it simply, commercial real estate properties are meant to make money. The land or building on a commercial property can create services or goods that then get passed along to the general public. Those operations can range from a small retail business all the way up to a full-scale plant.

Commercial real estate is generally categorized in six different spaces: retail, hotel, housing, industrial, offices, and special purpose.

How Does Commercial Real Estate Work?

Renting out a commercial property can be a great way to earn a living when it is done right. Appreciation is a crucial factor when it comes to investing in commercial real estate. When that property appreciates, it becomes more valuable.

Location can also have an impact on return on investment (ROI). Being located in a swanky neighborhood has a built-in attraction versus a run-down neighborhood. There are also tenants who provide rental income. What you want out of a commercial property dictates the type of property that you get.

What Are the Types of Commercial Real Estate?

There are three classes of commercial space: A, B, and C. Each has a specific target market. Class A tends to have higher rent because it offers higher-end amenities and finishes. Class C, meanwhile, is a low-rent operation where the function is the only important aspect. Class B falls in between the two.

There are also industrial properties that can have office space, manufacturing space, or both. There are also special purpose properties. Those are a bit more difficult to classify.

What Does a Commercial Real Estate Agent Do?

The great thing about commercial real estate brokers is that they can make the job of the investor all the easier. They take on the responsibility of the listing, connect with the people needed to bring in reliable tenants, and even negotiate the lease agreement.

Find a qualified commercial real estate agent before choosing your property. It will make the process much smoother, ensuring that you get the right property.