While industrial real estate doesn’t sound as exciting as other types of real estate investments, there are actually many benefits.
Things like long lease terms, lower vacancy rates, and long-term cash flow are potential benefits that some investors appreciate about this type of investment. Like with any real estate investment, it can be a risk. Industrial real estate can be very expensive and there are also roadblocks you should consider besides the possible benefits.
Industrial properties fall under the commercial real estate umbrella. It includes many businesses that are an integral part of the infrastructure of retail, e-commerce, and other industries in the economy. The main types of properties include:
The types of industrial properties in different areas vary based on the local infrastructure. Some areas are heavy on manufacturing, and some cities might have very few options for industrial investments.
There are ups and downsides to any investment, and this includes industrial real estate.
Pros:
Cons
There are also cons to investing in industrial real estate, including:
Investing in any type of real estate depends on many factors, and if you are considering an industrial real estate investment, it is best to talk to someone experienced in the industry, and in the geographic area you are looking.
This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions.
Programs that depend on tenants for their revenue may suffer adverse consequences as a result of any financial difficulties, bankruptcy or insolvency of their tenants.
All real estate investments have the potential to lose value during the life of the investment. Neither cash flow or capital appreciation are guaranteed.