Five Reasons to Invest in Industrial Real Estate
Commercial real estate opportunities are abundant—but they are not all created equal. Just think about some of the diverse options that are out there: You could invest in an apartment building, and become the landlord to a small community of people. You could invest in office space, or retail shopping facilities, or even in land, and each investment would come with its own unique benefits and challenges. And then there is an option that frequently goes overlooked, even by savvy investors: investing in industrial real estate.
Investing in a warehouse or a plant of some kind may seem like a major undertaking, and indeed it is. There are some real benefits to industrial real estate investments, though, that make it an option no investor should ignore.
Easy Tenants, Easy Management
To begin with, consider the kinds of tenants you will have in an industrial facility. It is entirely possible, if not fully guaranteed, that you will find industrial tenants to be generally less demanding and more self-sufficient than you will tenants in any other facility. If you run an apartment complex, for example, there will always be maintenance issues, big and small, around the clock. If your tenants are blue-collar workers, though, it is less likely that they are going to call you up over every dead light bulb or clogged commode. The management headaches may prove relatively few and far between.
On a related note, industrial real estate investments tend to offer greater stability. The landlord of an apartment building faces constant tumult, with residents coming and going as their leases expire. Tenants of an industrial space have historically signed on for much longer leasing periods—five years or more, in many cases. Of course, when it comes to keeping your investment property stocked full of tenants, less tumult is always better.
A Sound Investment
Simple from the standpoint of an investor, industrial real estate may not seem particularly glamorous, and indeed, you are unlikely to experience a great deal of appreciation in the value of the property itself. In many ways, though, that points to another advantage of industrial real estate investment. Industrial space is utilitarian, and it is always in-demand, so while it may not seem glamorous and it will not make you extravagantly wealthy overnight, it is a sound and prudent investment option that is largely independent from wild market fluctuations.
Another perk of industrial real estate is that it allows for a great amount of flexibility—so long as it is zoned properly, of course. You can have a building with a lot of office space, or a building with no office space, just warehouse space. In other words, you can accommodate your tenant’s needs, and that flexibility is always important in a real estate endeavor.
A Shrinking Field?
Finally, you might consider industrial real estate because it is a shrinking field. There is less and less industrial real estate being created and zoned, so the options for manufacturers and distributors are increasingly scarce. More than ever, a sound industrial property is a precious commodity.
For the commercial real estate investor, then, the options are plentiful—and industrial options are not to be overlooked. For more information on investing in industrial property, contact commercial real estate brokers Harley & Associates today.