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Investing in Industrial Real Estate: What You Need To Know

Investing in industrial real estate is a great way to add diversity to your investment portfolio. However, before you invest in industrial real estate, there are a few things you need to know.

One of the key things to remember when investing in industrial real estate is that the property must be able to generate a profit or maintain a healthy Internal Rate of Return (IRR). In other words, the property must be able to generate more income than it costs to operate and maintain. There are several factors you need to consider when assessing a property’s profitability, including the cost of operating and maintaining the property, the amount of rent you can charge tenants, and the number of capital improvements you will need to make.

In this article, we will discuss the basics of industrial real estate investment and provide you with some tips to help you get started.

What Is Industrial Real Estate Investing And How Can You Get Involved?

Industrial real estate investing is the process of investing in properties that are marketed exclusively for industrial purposes.

Industrial real estate is a type of commercial real estate that is used to produce, store or distribute goods. The most common types of industrial real estate are warehouses and factories. Industrial real estate can also include land that is being used for these same purposes.

There are a few things that industrial real estate sellers should keep in mind when putting their property up for sale. First, it is important to understand the market conditions and identify the right buyers that are looking for this type of property. Having a realistic idea of what your property is worth is also important.

Types of Industrial Real Estate

Industrial real estate can come in various shapes and sizes, but all types of industrial spaces share one common goal: to provide companies with a functional and productive place to work. Some of the most common types of industrial real estate include:

Warehouses

Typically large, open spaces with high ceilings that are perfect for storing goods and materials. These buildings are typically large and open, making them perfect for storing goods or materials.

Manufacturing facilities

These buildings are designed for companies that need to create or assemble products.

Research and development labs

These spaces are perfect for companies that need to innovate and test new products.

Distribution centers

These facilities help get products from the manufacturer to the consumer, often through a network of warehouses.

Types of Industrial Leases

Industrial leases can be divided into three types: full service, net lease, and triple net lease.

Full service

A full-service lease is the most common type of lease. Under this type of lease, the tenant is responsible for all costs associated with the property, including property taxes, insurance, and maintenance. The landlord is responsible for none of these costs.

Net lease

A net lease is a less common type of lease in which the tenant is only responsible for rent and certain operating expenses, such as utilities and janitorial services. The landlord is responsible for all other costs associated with the property, including property taxes, insurance, and maintenance.

Triple Net Lease

A triple net lease is the most common type of net lease. Under this type of lease, the tenant is responsible for all costs associated with the property, including rent, property taxes, insurance, and maintenance. This is slightly different from a ground lease.

How Do You Choose A Professional Investment Company? 

When looking into investment companies, there are a few factors you can look for to ensure you’re making a good decision.

  • Look for a company that disrupts traditional markets and looks for innovative ways to change the business.
  • Find a company with quick response times. You need a company that knows how to move quickly in this industry.
  • Choose a team with a track record of success and satisfied customers.
  • Look for a staff made up of dedicated financial professionals.
  • Look for a history of measurable points of success.
  • Choose a team with customer service that goes above and beyond.

If you start your search by looking for these qualities, you’re sure to find a company that can help you make your investment dreams a reality. Here are some more valuable tips on investing in commercial real estate, however, if you’d like to skip the search and get right down to investing, contact Point Acquisitions

In Point Acquisitions, we focus only on select property components, enabling us to remove the time-and-cost intensive processes involved with inspections, appraisals, and repairs, allowing you to make your sale faster. Click here to get in contact with one of our associates and start your future in commercial real estate today!

About The Author

Jesse Shemesh

With a wealth of experience in nurturing diverse commercial real estate investment portfolios across multiple markets, I actively engage in the development and execution of deals spanning all asset classes. My expertise lies in collaborating with strategic partners, including corporate real estate professionals, fund managers, developers, and investors, to source, identify, and entitle opportunities. At Point Acquisitions, we take pride in our unique, proprietary platform that specializes in property acquisitions, generating a steady stream of organic deal flow that sets us apart from the competition. As a seasoned professional in the real estate industry, I am dedicated to creating lasting partnerships and delivering exceptional results for all stakeholders.

Disclaimer

Please note that Point Acquisitions is not a tax expert or tax advisor. The information on our blogs and pages is for general informational purposes only and should not be relied upon as legal, tax, or accounting advice. Any information provided does not constitute professional advice or create an attorney-client or any other professional relationship. We recommend that you consult with your tax advisor or seek professional advice before making any decisions based on the information provided on our blogs and pages. Point Acquisitions is not responsible for any actions taken based on the information provided on our blogs and pages.

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