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Investing in commercial real estate is not just about buying a building, it is also about creating a stable source of income. It is an opportunity to transform industrial and other buildings into assets that work for you, generate profits and ensure financial stability.

Why invest in offices, shopping malls and warehouses?

Investing in commercial real estate offers the opportunity to operate in a dynamic economy where offices, warehouses and shopping malls are becoming sustainable income investments. These investments are not just ‘concrete and glass’; they are a fundamental part of the economic infrastructure. Office buildings are becoming hubs of economic activity, shopping malls are becoming the arteries of consumer demand and warehouses are becoming invisible but essential links in the supply chain.

Offices are sought after in all economies, but especially in prestigious locations where companies want to establish themselves. Shopping malls, on the other hand, act as concentrations of consumer interests, while warehouses ensure a continuous flow of goods. Together, these institutions offer a variety of investment opportunities with different returns and risks.

The main types of commercial properties: from offices to department stores

Think about the types of real estate you can invest in.

Office space

Companies, from small teams to large corporations, need professional workspaces. Representative offices in the city center are not only a matter of appearance, but also of convenience for employees and customers. Flexible office spaces, such as coworking spaces, are also becoming increasingly popular and help small businesses stay mobile.

Key factors for profitability are location and proximity to infrastructure. Offices in shopping areas can provide a steady stream of tenants, making them profitable for investors.

Shopping centers

A meeting place for active shoppers, where they not only shop but also have a good time. The variety of tenants, from fashion boutiques to large supermarkets, ensures that the risks for owners are limited and their income is stable.

Property owners benefit from the growing consumer demand, which is especially important in economically active areas, especially Moscow and St. Petersburg. There, the monthly number of visitors to large shopping centers can be between 1.5 and 2 million people. In 2022, the Aviapark shopping center in Moscow attracted more than 50 million visitors, which shows that there is still interest in the shopping center and it offers high profitability for investors.

warehouses

The “heart” of modern logistics. Due to the rapid development of e-commerce, warehouses have become indispensable in the supply chain. They not only store goods, but also distribute them, allowing companies to quickly deliver their orders to customers. Warehouses are an attractive investment object, especially in times of economic growth when the demand for logistics services increases.

Benefits and risks of investing in commercial real estate

In order to make an informed decision, investors should be aware of all the benefits and risks of investing.

Profitability, stability and capitalization

Unlike residential properties, commercial properties offer a more stable income due to the long-term lease agreements with tenants. Statistics show that specific returns of 8 to 12% per year can be achieved, depending on the type of property and location.

One of the main advantages is the capitalization of the investment. As the price per square meter increases, so does the value of assets, allowing investors to increase their capital without additional costs.

Unpredictability of tenants and market fluctuations

The sector also has its disadvantages. The unpredictability of tenants is one of the biggest risk factors. If a customer drops out or stops paying, this can have a negative impact on sales. Market fluctuations and economic crises can also affect the cost of space. It is important to take all these indicators into account when making an investment decision.

A list of the main risks of investing in commercial real estate:

1. Bankruptcy. In 2023, about 20% of tenants in Russia faced financial difficulties. This led to a 15% increase in rent defaults compared to the previous year.
2. Market fluctuations. During the economic crisis of 2020, prices fell by 10-15%.
3. High maintenance costs. The average maintenance cost for an office building in Moscow is about 3,000 rubles per square meter per year. This includes utilities, repairs and security, and can significantly reduce profits.

How to choose a property for commercial real estate investment?

Location is the basis for success. Choosing a location in the city center or in a development area can have a significant impact on your profitability. A good location attracts tenants and ensures high occupancy.

Examples of successful investments include properties located near major transport hubs, such as metros, train stations or major road intersections, as well as near public transport stops. These locations attract tenants because they are easily accessible for employees and customers. This is especially important for office and retail spaces.

Office buildings near the Moscow metro have a high occupancy rate due to good public transport. Shopping centers near major transport hubs also attract larger flows of visitors.

Type of tenants and income stability

To successfully invest in commercial real estate, it is important to know who will rent the premises. Long-term contracts with reliable people help minimize risks. Office spaces occupied by well-known companies, retail spaces rented to retail chains or warehouses rented to large logistics companies provide a stable income.

A step towards a stable future

Financial investments in non-residential buildings offer the opportunity to generate sustainable income, ensure a stable future and increase the value of assets. Competent investments in commercial real estate require a careful approach, risk analysis and the selection of suitable properties. But for those who are willing to take on the challenge, this path can lead to financial independence. The opportunity to be part of this dynamic field is not to be missed.

The new year brings new rules for everyone who wants to preserve and grow their capital. Investing in real estate is still one of the most reliable and proven options, but the market sets its own conditions. In 2024, technological, environmental and social trends will radically change the way we invest. Old patterns fade into the background and new opportunities require deep understanding and analysis. Successful investments today depend not only on the choice of an object, but also on the ability to anticipate which trends will be profitable.

Trends in real estate investment in 2024

Today, the residential and commercial market is not just about square meters, but about a complex mechanism that adapts to new conditions. Investment opportunities in real estate in 2024 go beyond traditional approaches. Technology, the environment and changing consumer preferences create the conditions for the development of new strategies. By understanding trends, investors can make well-considered investments and minimize risks.

Energy-efficient buildings

Energy efficiency is not just a buzzword, but a necessity of the moment. Stricter environmental regulations and rising energy prices make new construction one of the most sought-after investments. By reducing the consumption of raw materials by 30-40%, we not only contribute to the preservation of our planet, but also make apartments attractive to tenants and buyers. Investments in such assets yield a return of up to 10% per year. In addition, the energy efficiency certificate (LEED, BREEAM) increases the value of a building by 15%.

Example: The price of a house in a residential complex with solar panels in the Moscow region has increased by 25% in three years.

Smart homes

Smart technologies are not the future, but the present. Smart homes with automatic lighting, climate and security systems increase the liquidity of real estate by 20%. The nature of the investment in such properties increases rental income by 15-20%. The popularity of IoT devices is growing: 60% of buyers already prefer homes with automation functions.

Investments in low-rise complexes

Low-rise buildings are gaining popularity. More and more often, couples and home workers choose to live in rural areas. Investors who invest in low-rise complexes receive stable returns. Over the past five years, the cost of this type of housing has increased by 25%, while the demand for rural housing has increased by 30%. An important success factor is the developed infrastructure: schools, shops, transport links.

First: The investor is looking for a solution for 2019 for 4 million rubles. In 2024, the population will reach 6 million, and civilizations will have excellent infrastructure and advanced outbreaks.

How to invest in commercial real estate?

Commercial real estate remains one of the most profitable market segments. Investing in commercial real estate requires careful analysis, but with the right approach, this method can bring a return of up to 15% per year. In 2024, successful investments depend on choosing the right sector and understanding the needs of the market.

Advantages of the different segments:

1. Office space. Traditional office spaces are losing popularity due to the rise of remote working. Flexible spaces, such as: B. Coworking spaces, show an annual profitability growth of 12%. Rents in modern shopping malls remain stable due to demand from startups and small businesses.
2. Storage facilities. E-commerce is driving demand for warehouse space. Investments in warehouses near major transportation hubs generate stable returns of up to 14% per year.
3. Shopping malls. Large shopping malls are making way for small neighborhood centers. The profitability of these types of facilities is 10% if the right location and tenants are chosen.

Opportunities to invest in real estate with minimal risk

Every investor wants to limit the risk, especially when it comes to large amounts. In 2024, there are reliable tools available that make real estate investments safe and efficient. A competent approach and diversification ensure stable profits with minimal losses:

1. Real estate investment companies. REITs offer the opportunity to invest in large projects without having to buy real estate directly. The average return on these funds is 8-10% per year. The advantage is diversification and the possibility of generating passive income. For example, by investing in a fund specializing in commercial real estate, investors were able to achieve a return over a period of 5 years that was 45% higher than with a conventional investment in apartments.
2. Shareholding in construction. If you invest in the initial construction phase, you can purchase a home 20 to 30% cheaper. There are risks associated with delivery dates, but experienced developers minimize them. The strategy is suitable for long-term investments with an investment horizon of 2 to 3 years.
3. Purchase of properties with long-term tenants. Real estate delivered with rent: stable cash flow. The profitability of these properties is 12% per year.

Where to invest in real estate: the best strategies for 2024

Investors often ask themselves: where to invest in real estate? In 2024, the answer depends on the amount of capital, the level of risk and the investment horizon.

Strategies for different budgets:

1. Small capital: investments in rental studios or investments through crowdfunding platforms.
2. Medium capital: purchase of apartments or low-rise housing.
3. Large capital: acquisition of commercial real estate.

Promising regions:

1. Moscow and St. Petersburg: stable profitability and high liquidity.
2. Southern Russia: Growing demand for holiday homes.
3. Siberia and the Far East: infrastructure development creates new opportunities. Mistakes in Real Estate Investment

Typical mistakes can reduce the profitability of a capital investment to zero. The most common are:

1. Poor location selection.
2. Ignoring hidden costs.
3. Investing in real estate with low liquidity.

Conclusion

In 2024, a variety of real estate investment opportunities will offer new opportunities for those who are willing to adapt to change. Success depends on the ability to analyze the market, select promising properties and avoid common mistakes.