Commercial and Investment Properties
What is Commercial real Estate
Land development is very costly and there aren’t all that many developers capable of successfully taking the project from raw land to completed houses. The ones who know how to do it may not have the necessary capital available. Funding for these projects can be difficult to get in traditional banking circles. This is where your creativity comes into play. Being able to create the financing by putting together several different lenders will separate you from the rest of the pack. There are government agencies involved in the process of getting the land zoned appropriately. You must know how to navigate these agencies.
In all areas of real estate investment and development, there will be many professionals involved along the way. Some of them include:
* Architects, both interior and landscape
* Civil engineer
* Construction company
* Engineer, surveyor
* Tax consultant
RISK vs. RETURN
Risk is simply the possibility that something negative will occur and have a harmful effect on the outcome. As with any business, there is a certain amount of risk. However, because commercial real estate usually involves so much money, the opportunity and probability of risk are great. Needless to say, the greater the risk the greater the return! A free market demonstrates this principle: strong vs demand for a safe investment drives its price higher (and its return proportionately lower), while weaker demand for investment with more risk will drop the price. In this case, the potential for the return would increase. As an example of an investment with low risk, let’s use a U. S. Treasury Bond. This investment carries very little risk when compared to corporate bonds. Therefore, the return on the Treasury Bond would be lower than that on the corporate bond. A perfect example of RISK VS RETURN.