Commercial property investment can be generally categorized into three major sectors of retail (shopping plaza, supermarket, restaurant, coffee shop etc.), office (office building, business park etc.), and industrial (standard industrial building, distribution, warehouse, logistics facilities etc.).
Just like the apartment building investment, it can bring great rewards as well as posing big risks. Both types of investment require considerable capital and extensive expertise in real estate investment.
Given the fluctuation of equity market recent years, lots of new participants are joining the commercial property investment due to the following advantages:
- Long-term cash flow
- Low volatility
- Tangible asset
The risks associated with commercial property can be:
- Property risk
- Market risk
- Liquidity risk
- Tax risk