Due to the improvement
in the American economy, many investors have chosen to fund the purchase of the
commercial real estate properties. The commercial real estate is any property
that is not used for residential purpose. Some of the examples of commercial
properties are shopping malls, IT parks and others. Any property built and
developed to host a commercial activity can be grouped under ‘commercial real
estate’.
The experts say that
there are billions of dollars in the loop, waiting to go to fund an
economically viable and profitable business. Funding can be sourced through private
equity funds, pension funds, life insurance companies, REITA and other sources and
it can be used for the purchase of commercial real estate properties. Even
banks have relaxed their underwriting criteria, so that more amount of capital
is available in the market.
Reason for the hike in the investment activity in
commercial real estate
The first and the
foremost reason that the investors are very much motivated to invest in this
market is that the yield is expected to be high. In a few years, the real
estate has moved from ‘out of favor asset’ to ‘in favor asset’. People always
look for something to invest which has a very less risk involved in it. In the
risk and return threshold, any asset that has high return and very less risk
involved in it is considered to be a very perfect solution for investing. The
results of the stock and bond market are highly unpredictable. The bonds that
were considered to be safe suddenly became undesirable, due to the economic
condition.
In this uncertain
global economy, the high probability of turbulence in the bonds and stock
markets has made the real estate, a better option for the people to invest with
very little risk. They can surely expect high yield or return, in the future.
The solid income in the future and the less risk factor involved has made the
domestic and the commercial real estate, more attractive in the eyes of the
investors.
Forecast for commercial real estate and the elements
involved in it
All the investment
results in the coming days of 2013 would be positive news for anyone who is
planning to be a part of the commercial real estate property arena. The supply
and demand game in the commercial real estate market is a complex and is always
fluctuating. The demand and the supply are negatively co-related. When the
supply decreases, the demand increases. Thus, the rents spikes out and people
look out for new construction opportunities. This type of market growth fuels
the practitioners, who are very specialized in this industry.
May it be a broker or
an investment manager, the number of commercial deals for real estate in this
year is forecasted to be very high. This high growth in the investment
activities in this industry would lead to more opportunities and commissions
for all the elements in this industry. With more number of funds available for
the industry, the brokers and the investment managers would experience a high
fee for the processes, the number of jobs related to this industry increases
and moreover, the output of this industry would increase providing high yield for
the investors.
Do you need a loan to to buy a commercial property?.
Call us!.
Great Falls Commercial Lending
1 Howe Ave, Suite 303
Passaic, NJ, 07055
Tel. 973-767-2850
Fax. 1-877-767-2150
info@gfcommerciallending.com
www.gfcommerciallending.com