5 Profitable Commercial Real Estate Business Ideas

As a result of the pandemic, many people have become more financially literate and interested in self-employment. Because of this, the commercial real estate industry has piqued the interest of many. Browsing free commercial real estate listings is one way to get your foot in the door of the industry. 

Starting your own commercial real estate business might seem appealing to someone who’s been educating themselves on the industry and its inner workings. Let’s dive into 5 types of profitable business ideas related to the commercial real estate industry.

What to Consider Before Joining the CRE Industry

Knowing and understanding how commercial real estate works is one of the most important things to do before leaping into the industry yourself. Keep in mind that if you are someone who has residential real estate knowledge, they are not the same and these industries differ greatly.

Investing your time and money in the commercial real estate business can end up being a huge risk, but if you are confident in your abilities you can also reap huge rewards. 

Here’s a list of the most profitable types of CRE investments:

• Properties with the highest number of tenants can generate a larger income, but you could still make a decent profit on a building with less tenants with higher rent payments.
• Properties with triple net leases (single-tenant spaces whose tenants are more likely to sign long-term leases) is profitable since it puts some of the financial responsibilities on the tenant. This is great for newcomers since it allows investors to have a stable income without worrying about maintenance costs.
• Properties in a growing area are more likely to attract tenants willing to renew their leases, as well as attracting new tenants. If you’re new to real estate investment, however, you may need to focus on effective marketing strategies and networking to keep up with the competition.

Choose the property that you wish to invest in carefully to ensure that you can gain as much profit as possible. However, keep your needs in mind when it comes to choosing the best lease for you.

1. Commercial Real Estate Development

Property developers buy a piece of land to build an entire property that they can then sell or lease to tenants. Embarking on this business venture can be risky, but taking calculated risks is what can give you the biggest profits. 

The success of your property development venture relies heavily on the initial site that you choose to build on. The property itself can go through many changes, but the location that it’s at cannot be changed once you’ve bought it.

There is a lot of marketing that goes into generating intrigue in the new building that you’re hoping to sell or lease. 

Take a look at the area you’re building in to see what kind of commercial property would be ideal. Keep a real estate broker up-to-date on the construction process so that you’re more likely to get a tenant in there fast.

2. Commercial Real Estate Management

While a real estate manager is similar to a real estate developer, their focus is mostly on managing their property and its tenants. Real estate managers are in charge of property repairs, managing rent, negotiating leases, and showing the property to potential clients. 

Anyone who is new to commercial real estate investment should look into hiring a property manager. It may seem like an unnecessary expense, but you won’t be able to profit off a property that you cannot manage alone. 

Property management software may also be useful to streamline the management process. Here’s some of the most popular software:

• Doorloop allows users to collect rent from their tenants, receive maintenance orders from tenants, schedule showings, and more.
• RealPage Commercial allows tenants to make rent payments and view their balance.
• VTS provides users with marketing and sales-level analytics.

Many of the property management programs have similar features, but it’s up to you to determine what works best for your needs.

3. Landscaping Services

Even though it seems like there wouldn’t be, there are actually some pretty significant differences between the landscaping of residential and commercial properties. In most cases, commercial properties are much larger than residential ones. With that in mind, commercial clients also have a higher budget and more ongoing demand to keep up with their image.

If you want to start your own commercial landscape business, you’ll have to keep accurate yet competitive pricing in mind. It might take some time to find an accurate balance for your rates, but having a fair price will bring more clients to you.

As you begin to grow your business, try to use the services you provide to set yourself apart from other landscaping agencies. Provide your clients with excellent customer service as well as work hard to make their landscaping look as creative and tidy as possible. 

4. Commercial Real Estate Blogging

If you are well-versed in commercial real estate, you can always show off your expertise by becoming a blogger. Use your blog to spread the knowledge that you’ve gained as a CRE investor. 

Here are some quick tips on how to start up a CRE blog.

1. Focus on how to overcome challenges related to real estate.
2. Put yourself in your readers’ shoes to determine what information is best.
3. Address one topic per post to keep it simple.

Starting your own blog alongside your CRE business can help you market your company. But if running your own blog and business is too much, reading other CRE blogs for inspiration can provide you with some helpful insight on how to effectively market your business.

5. Commercial Property Inspector

The market for commercial property inspectors is completely different from residential property inspections, so it’s relatively untapped in comparison. Depending on the state that you live in, you could be required to take training courses or pass state exams. 

The depth of the building inspection can vary largely depending on the owner. Some could desire a truly thorough inspection, while others just want a signature to satisfy their lender. There is a standard code developed by the International Association of Certified Home Inspectors that inspectors can use as a guideline.

Commercial inspectors will examine the HVAC, electrical, roofing, structure, and whatever else is required in the contract signed between the client and inspector. These inspectors are crucial during the process of due diligence.