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Why Creating a Commercial Property Portfolio is a Good Idea


If you’re looking for a way to seriously boost your income, commercial property investment could be the answer. The commercial sector is always in-demand; particularly in cities and large towns. So, when compared to residential property, it delivers a substantial amount of benefits.

To help you decide whether a commercial property portfolio is right for you, below you’ll discover some of the main benefits it can provide.

Helping to Provide a Long-term, Healthy Profit Stream

The main reason you’ll be considering investing in commercial property is to make money and there’s plenty to be made! Unlike the residential property market, commercial properties are leased out for long periods of time. With a buy-to-let property, the maximum tenancy is usually 12 months, then it goes onto a monthly lease basis. Commercial property on the other hand, is a long-term income-stream. The leases are usually far longer than a year.

You Aren’t Usually Responsible For Repairs and Maintenance

Another cost benefit of a commercial property portfolio, is the fact you won’t need to cover repairs and maintenance. While landlords of residential properties are typically responsible for any repairs, with commercial properties it’s different. So, you’ll be receiving the money for the lease without the responsibility of taking care of the building.

It’s a Great Way to Diversify Risk

One of the main concerns when investing in property is the risks involved. Creating a property portfolio is no doubt expensive and the risk of losing money on the investment is always a concern. However, with a commercial property portfolio, it diversifies the risk.

If you select a good range of different properties, you’ll find it much easier to overcome any issues you may have along the way. For example, if you start by investing in an office block in a desirable area, you can let out each office to a different tenant. This would give you various streams of income. Therefore, if one tenant was to stop paying for the lease, you’d still have many others to cover the costs until you can get a new tenant in. The more commercial properties you add to your portfolio, the less risks you’ll incur.

Overall, creating a commercial property portfolio can be an excellent idea. You just need to take your time to do your research and ensure you’re selecting the best properties for investment. There’s many factors you need to take into account but if you take the time to do your research, you could end up making a healthy profit.

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