A Guide To Commercial Real Estate Investment In San Antonio, TX

Real Estate Investment

Homes are still selling fast in San Antonio. While residential real estate investing is popular in San Antonio, another area of real estate investing you may want to explore is commercial real estate investing. Residential real estate investing is purchasing homes to resale them for residential purposes. Commercial real estate investing is purchasing property for resale for commercial development. This could include office spaces, retail spaces, hotels, and a host of other places where businesses operate. If you want to become a commercial real estate investor in San Antonio, here are some tips to get started. 

Start With Residential Investing First

This may sound counterintuitive, but it may be a good idea for you to start with residential investing before diving into commercial investing, particularly if you have a low-risk tolerance. Think of this strategy as the same as playing Monopoly. In the game of Monopoly, you buy the property, then you buy houses, and then you trade up the houses for hotels. While you may not employ this same strategy entirely, you can start by getting your feet wet on the residential side of things and then moving to commercial once you strengthen your risk tolerance. Once you are comfortable with switching to commercial investing, you can invest in apartments, or you can choose other options such as hospitals, storage facilities, shopping malls, or other commercial buildings. 

Opt for Crowd Funding

Another way to break into commercial real estate investing is to utilize strength in numbers. Instead of using your own resources and bearing all the risks yourself, you can use crowdfunding to help you invest in commercial real estate. 

Real estate crowdfunding is when several investors come together to fund a commercial piece of property by pooling their resources. It is typically done through a fintech site in which the money pooled is paid into a real estate investment trust (REIT). Investors may get a one-time huge profit or ongoing profit. 

FAQs About Commercial Real Estate Investing

Do you still have pressing questions about commercial real estate investing? Here are some answers to frequently asked questions about real estate investing. 

How much can I expect to gain from commercial real estate investing?

Returns on commercial real estate investment range from 5 to 12 percent. Residential real estate typically yields 1 to 4 percent. 

Do I need a real estate license to participate in commercial real estate investing?

No. You don’t need a license to invest in commercial real estate. You will only need one if you plan to sell commercial real estate in Texas. 

Should I get insurance for my commercial properties?

Yes. It is important to ensure that you get proper insurance for your commercial properties

Should I have an exit strategy?

Yes. It is a good idea to have an exit strategy if the investment doesn’t work out as you plan. However, you should keep in mind that returns on commercial real estate investing are much slower than residential. So, you will have to develop a lot of patience when waiting on your returns. It could take upwards of seven years or more to start to see returns.

Read Also: A Brief Overview of the Real Estate Development Process