While most property investors start with residential, commercial property offers distinct advantages worth considering as your portfolio grows.
Commercial properties typically offer higher yields (5-10% vs 2-4% for residential), longer lease terms (3-10 years vs 6-12 months), and tenants who pay outgoings including rates, insurance, and maintenance. The trade-off is higher entry costs, longer vacancy periods, and more complex management.
Commercial property types include retail, office, industrial, and mixed-use. Each has different risk profiles and market dynamics. Industrial and logistics properties have performed strongly in recent years, driven by e-commerce growth. For investors considering commercial property, working with a buyer's agent who specialises in this space is particularly valuable given the complexity involved.