Pros and Cons of Buying Commercial Land

Buying commercial land is a big decision that comes with many pros and cons. Here are some of the important things to consider when deciding to invest in commercial real estate. 

The Positives of Commercial Land Investment

Commercial real estate can be a great source of income with lower hassle than residential real estate. For example, you'll be dealing with professional clients who potentially understand the market a little bit and won't make any unreasonable demands. Since these people have a stake in the appearance of their own businesses, they may be better tenants who take care of their property. Since businesses operate on a normal 9-to-5 schedule, you won't have to deal with all-hours tenants. And aside from the time benefits, commercial real-estate developers have the option of being very flexible with their properties. You may choose to rent out entire spaces or buildings or split spaces up to do some very unconventional things. 

The Negatives of Commercial Land Investment

There are also a few negatives to investing in commercial land. First of all, the time until you see any returns is greater. With a vacant plot of land, it will be years until you finish development and begin seeing tenants. It can also be a greater risk to invest in commercial land. There is a lot more money being put down up front as opposed to the money put down on residential real estate or other smaller-scale investments. However, the potential returns can also be much greater if you are able to snag several high-paying tenants. 

What Makes the Difference in Choosing a Great Investment 

If you are interested in buying commercial land, there are a few things that you must do to ensure you get a good deal that will pay off in the long run. The first is to choose an experienced commercial real-estate agent. Even if you have worked with a residential realtor in the past, it's important that you get a commercial specialist because the criteria for a good purchase will be different. 

Second, you may have to step outside of your operating area to find the best deals. Your commercial land investment may go the furthest in a city farther away from your home, meaning you'll have to factor in the costs of regular visits or a property manager to help with the development and upkeep. Your real-estate agent will help you evaluate the total cost and benefits of each potential investment.

Talk to a company such as The Schueler Group for more ideas.