Since the imploding of the Financial Crisis back in 2009, banks and other financial lending institutions have been weary when it comes to lending money to Commercial Real Estate investors. And to be honest…. we don’t blame them, since “CRE loans were in part responsible for the near-collapse of the financial system during the Financial Crisis,” according to Business Insider.
Amazon is dominating e-commerce and now brick-and-mortar, or at least making every attempt to. In order to do so the online giant will have to increase its retail footprint, by doing so, Amazon will be able to accomplish what all their customers demand, faster and cheaper delivery. Read More
This last year in Long Island has shown to be a pretty decent year for the Industrial commercial real estate market. With an overall vacancy of 6.9% and over 700,000 sq ft under construction, Long Island,NY proves to be a hot spot for industrial property. Read More
Atlanta’s Industrial market in 2017 has shown great promise for 2018. According to a report done by Cushman & Wakefield, Atlanta, Georgia’s industrial market had an overall positive absorption of 20.4 million sq ft, which exceeded all expectations for the area and a previous record set in 2014 by 26.7%. Read More
As you may know, Cap Rates are essential in any commercial real estate investment and having an accurate cap rate helps investors determine whether or not a property is worth the risk. We here at myNOI calculate local cap rates for all commercial property types on a daily basis, using our Local Cap Rate tool.
We’ve recently calculated industrial property cap rates in the Mesa, Arizona area and here is what we’ve found:
After comparing the cap rates of industrial properties in the surrounding Mesa, Arizona area that have sold in the last six months, we found that the cap rates ranged from 5.5% – 9.15%, with an average of 6.97%.
For a cap rate in your area, use our easy to use Local Cap Rate tool and we’ll help you determine the average cap rate in any particular area.
Investing in industrial properties may not be as luxurious as purchasing a high-end office building or leasing a fancy retail store, but smart investors can make a healthy profit from them. While not glamorous, industrial properties have provided a steady 10.6 return for the last 20 years. This consistency should make them a staple in any investor’s portfolio.
Industrial buildings are split into four separate asset classes. As you consider investing in industrial properties, decide if you want to pursue a warehouse, manufacturing or flex/R&D building.
This asset class is pretty simple and to the point. Warehouses are leased by buisinesses for storage and distribution purposes. These properties generally feature very little office space. They may also be specialized, like freezer buildings.
Manufacturing properties are used for the production of products from raw materials. This asset class can be further broken down into light or heavy industrial use.
Like the name implies, these buildings give tenants some flexibility in how they use the property. Companies may choose to use a majority of it as an office space and leave little room for anything else. Or go the opposite direction.
Industrial properties’ tenants usually sign multi-year, long-term leases. These contracts can stretch anywhere from three years to ten years. These extended leases with responsible tenants can provide some pro-growth stability over the years. And allow investors plenty of time to plan ahead for when their current tenant makes the decision to move to a different industrial property.
Industrial properties are often highly specialized to the current tenant. Businesses that lease out industrial properties will likely demand the building be tailored to their specific needs. This can make replacing tenants a wildly expensive process. Another reason it’s good to have long leases.
Industrial real estate is becoming a hot commodity in the age of e-commerce. Large online retailers like Amazon are buying or building warehouses to help with their distribution models. Strategically placed industrial properties can dramatically decrease the time it gets their products into the hands of their customer. As well as shave valuable cents off the cost of doing business.
This is a good time to begin investing in industrial properties.