The average rental falls in the range of 6-10 percent on commercial property investment according to industry experts.
The commercial real estate property investment reason you must factor in for the success of your investment goals.
While the rental yields on residential properties have been low, the rental yields on office spaces seem promising, in the long run, depending on the choice of location and quality of corporate tenants.
The average rental falls in the range of 6-10 percent on commercial properties as compared to 3.5 percent on residential properties according to industry experts.
When it comes to commercial rental yield in India, the demand for good office real estate assets is on the rise owing to the imminent possibility of the first REIT listings and employment generation.
Offices located in Grade-A buildings, logistics centers, and InfoTech parks are generating dependable ROI and steady investors who were most likely previously found only in residential property asset classes.
With the upsurge of private equity inflows in 2017, the trend is only likely to continue. The highest rental yields in India are expected with REITs bringing liquidity into commercial property investment in India. This is expected to further enhance the willingness of developers focused on the commercial office segment to deploy further assets.
The continuing sluggishness of the residential property market prevails in combination with associated re-investment cycle risks. This is also expected to play a major role in driving more investments toward various categories of commercial real estate for commercial rental yield in India.
With good office spaces in smaller cities, the corporate has begun expanding in Tier-I and Tier-II cities as well. Such assets are often located in areas that support the transport of goods and people.
Optimization of office real estate portfolios in the most efficient ways in the current market scenario are also enhancing economies of scale.
Smaller cities are also helping in consolidating the operations of corporate at reduced costs. This is being further enhanced by long-term leases to reduce operating costs. They may even look to sell these spaces which would mean quality spaces entering the market where the need for such services is more.
In our commercial property investment tips, it is important to mention that India’s start-up boom has contributed to employment opportunities and increased investments. Examples are previously established start-ups that are now showing excellent results.
While their initial contribution to commercial space absorption was less, e-commerce companies now account for over 3 % of the annual overall commercial space absorption in India. This is only set to increase provided the enthusiastic consumer response to e-commerce in India.
Start-ups in retail, manufacturing, and InfoTech as well as life sciences and biotech are only increasing their potential.
They are becoming the prime beneficiaries of the government’s Digital India initiatives. Note that India has already transformed itself into one of the world's most promising and prominent destinations for start-ups.
Meanwhile, many start-ups which are focused on the real estate sector have had a positive influence on the highest rental yields in India such that they have brought about a higher saturation of architectural design technology utilization and modern construction. They have further enhanced transparency and efficiency quotients of research services and real estate brokerage.
In the end, we can say that investment in commercial properties always executes with the help of the best developers in India.
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