Real Estate Investing

Commercial real estate is where it’s at. Financial Week today referred to the “credit crunch” as a “speed bump” for the commercial market, even though it proved a major setback for the residential real estate market. Commercial space is primarily leased rather than owned, which only helps the market conditions. After all, even with residential real estate, the rental market has surged and it’s not a bad time to be a landlord.

Unlike the residential real estate market, commercial real estate is healthy across all sectors. Commercial real estate is enjoying its highest occupancy rates since late 2001, and lease rates are at a record high. Sales volume in the commercial real estate market cannot be denied, for it is also at a record high.

For the purposes of illustration, take a look at Las Vegas. The area’s residential market is seeing soaring foreclosure rates, tremendous inventory surplus and falling prices. Meanwhile, the commercial real estate market is robust, particularly in industrial and multi-tenant retail complexes. The Nevada Business Journal recently quoted David Goldwater, founder and president of private lender Goldwater Capital, LLC.

“You remember last year how everyone wanted to turn retail into single-family housing? Now they want to go the other way around,” Goldwater said.

Investors will want to avoid jumping the residential real estate ship completely, because most analysts say that ship will be righted within a year. At any rate, commercial is worth exploring in most markets, and it’s a relief to know that some property deals can still bring prosperity.