Beginner’s Guide To Commercial Real Estate Investing: Basic Introduction and Processes

Beginner’s Guide To Commercial Real Estate Investing: Basic Introduction and Processes


start investing in commercial real estate

Investing in real estate is a great way to build wealth. Commercial real estate investing, in particular, is known to provide some of the highest income streams. If you’ve been investing in residential real estate for a few years, or simply a beginner wondering  how to invest in commercial real estate, this guide provides the basic introduction and processes to start investing in commercial real estate.

What Is Commercial Real Estate (CRE)?

Commercial real estate (CRE) is property that is either  used exclusively for business-related purposes or to provide a workspace rather or a multi-unit residential space with 5 or more units. Most often, commercial real estate is leased to tenants to conduct income-generating activities.

What are The Basics of Commercial Real Estate?

Commercial real estate and residential real estate comprise the two primary categories of real estate property. Residential properties include structures reserved for human habitation and not for commercial or industrial use. As its name implies, commercial real estate is used in commerce, and multi-unit rental properties that serve as residences for tenants are classified as commercial activity for the landlord.

Commercial real estate is typically categorized into four classes, depending on function:

  1. Office space
  2. Industrial use
  3. Multi-family rental
  4. Retail
  5. Special Purpose

Individual categories may also be further classified. Office space, for example, is often characterized as Class A, Class B, or Class C.

Class A represents the best buildings in terms of aesthetics, age, quality of infrastructure, and location.

Class B buildings are usually older and not as competitive—price-wise—as class A buildings. Investors often target these buildings for restoration.

Class C buildings are the oldest, usually over 20 years of age, located in less attractive areas, and in need of maintenance.

How Does Commercial Real Estate Investment Work?
Commercial real estate investing involves putting money toward purchasing commercial real estate property, including office buildings, multifamily apartment buildings, hotels, malls, storage facilities and shopping centers, among other property types. If you’re interested in this type of investment, you must be committed to having the commercial real estate holding invested for the long term.

Commercial real estate investing offers investors an array of opportunities and advantages that other investment strategies do not. Once the benefits of commercial real estate investing are recognized, the next step is to dive in.

How to Get Started in Commercial Real Estate Investing?
The question of ‘how to invest in commercial real estate’ has only one answer: due diligence. Regardless of what sector or niche you’re in, doing your homework and minding your due diligence is critical in ensuring your success in real estate. Besides learning the ins and outs of commercial investing, make sure you understand the commercial real estate market and how it can differ from the residential real estate market.

Commercial real estate investing can be a highly profitable investment opportunity for those who wish to diversify their portfolio. And if you’re ready to start investing in commercial real estate, CPD Homes, LLC is here to assist you. We are a part of a national network of real estate investors and see no situation as unsolvable.  It’s our mission at CPD Homes to connect investors to these alternatives: passive real estate investing in multi-family properties and apartments.  We have been consistently earning strong secured yields for our clients since 2012.  Our investors earn these returns with virtually no effort.  Since we own/operate the buildings and properties, there’s nothing to do as a passive investor—just cut the check and invest!

Sign Up and Learn How To Start Investing!
Register on our investors’ portal and learn how to earn strong, secured returns as a real estate private lender and passive investor. Also, learn how the Passive Investor Process works HERE.  Once registered, you will be able to see deals, watch videos, view projections, see past results, and review pro formas.  Better yet, call us today at 216-619-4387, or visit www.cpdhomes.com.   Learning is the KEY to success!

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