Many business owners take advantage of the real estate market and invest their money in property. Adding commercial real estate to your portfolio can be profitable when you invest wisely. Before you jump into the market, answer the following questions.

What Are My Priorities?

Take the time to write down your short-term and long-term investment goals. Be sure to include the type of investment properties you will consider. Some owners prefer to focus on multifamily units. Others only consider industrial properties. There is no correct answer for any one investor.

The best way to determine what properties you will enjoy investing in is to learn about the – industrial, multifamily, retail, industrial, and office. Join an investment network. Read industry materials. Watch videos and podcasts from other investors. Learning the tips and tricks of the industry helps you become a smarter investor.

Who Can Help?

Professional real estate agents, land surveyors, engineers, and real estate attorneys bring experience and information to the table. In the beginning, it may be worth the time and expense to build this professional team. After you have accomplished several transactions, they can save you time by bringing vetted properties to your attention.

How Do I Make Money?

One of the greatest advantages of purchasing commercial real estate is the opportunity to collect revenue from tenants. Many existing commercial properties have active rental contracts. When you close on the property, you receive the rental income. Commercial tenants are typically 4-to-5-year contracts, so costs associated with repairing units or finding tenants are minimized.

Can I Use the Building?

Alternatively, you may find a building that is an ideal location for your existing business. Once you have occupation permits, move your company into that location. You control your rent costs, by simply charging the mortgage payment amount for your lease. In addition, you can take advantage of tax benefits available to the commercial property owner.

What About Retirement?

While all investments have inherent risks, real estate values increase over the decades. With these properties in your portfolio, you are putting yourself in an ideal position for retirement. When you are ready to transition out of the active workforce, you can hire a property management company to handle day-to-day operations and still receive a rental income. Alternatively, you can sell the properties, assuming that the market has increased the value beyond your original purchase price.

When you add commercial real estate into your investment plan, you are strategically diversifying your portfolio. Taking the time to answer a few questions and learn about the investment process helps you become a savvier investor.