Throughout the United States there is a growing demand for what are called “office condos.” Office condos are similar to condominium units in that each person owns a unit in an attached development. Office condominium developments give business owners a chance to own their property instead of leasing.
Not all business owners, however, want to own an office condominium. Consider an attorney or doctor who is just starting out. They may want the desirable location of the new office complex, but not have the money to pay for the purchase of the property. They may prefer to rent.
Purchasing office condo rentals is one way to invest in commercial real estate with little risk and work. You can use the rent to pay off the loan on the commercial property. As the area continues to grow, the office condo rentals will increase in value. Eventually, when you sell the commercial real estate investment, you will have earned a profit.
Office condos have maintenance fees just as residential condominium developments. If you purchase one of the office condo rentals, you will be responsible for the maintenance fees. This is known as common area maintenance and is usually split between all of the occupants of the development according to their square footage. The fees for the common area maintenance are generally passed on to the renter.
One of the nice things about investing in office condo rentals is that you will be renting the property to a business instead of an individual. Most office condominium developments are either purchased or leased to professionals such as those in the medical field or legal field. These people work hard to get to the point that they do and rarely default on their rental payments. It does not look too good for a doctor to get evicted for not paying his or her rent. While residential rental units can sometimes be a battle when it comes to getting good, qualified renters, office condo rentals usually bring you quality renters.
In addition to purchasing an office condominium to rent to a professional, you can also opt to build an office condominium development. This does not have to be a large development, but can offer some professionals a chance to purchase their office space instead of leasing. You can even rehab an older building and turn it into office condos as long as you get proper authority from the municipal zoning board. There are hundreds of opportunities to construct office condos for commercial real estate investing. You can continue to own the condominiums and collect the rental to pay towards the loan, waiting for the property to rise in value before you sell, or rehab or construct office condos and sell them outright.
If you decide to work with office condo rentals, or perhaps build an office condo development, you will need to set up a condominium association that will handle the maintenance of the area surrounding the building such as the grass, snow removal, trash removal and any repairs on the common area.