Why Good Residential Investors Get Commercial Property Wrong!

Episode 92 – Why Good Residential Investors Get Commercial Property Wrong!

You've successfully invested in residential property for years. You understand property, finance, tenants and how to create value.

So moving into commercial should be fairly straightforward… shouldn't it?

Not necessarily.

In fact, some of the instincts that make you a successful residential investor can lead you to make expensive mistakes in commercial property.

Because commercial property isn't simply residential property with a business tenant.

The rules are different.

In this episode of The Commercial Property Podcast, Suzi Carter reveals the biggest mindset shifts residential investors need to make when moving into commercial — and the assumptions they need to leave behind.

Why might an ugly industrial unit be a better investment than a beautiful shop?

Why could two identical buildings next door to each other be worth completely different amounts?

Why isn't a 9% yield necessarily better than a 6% yield?

And why could changing a few words in a lease potentially create more value than spending thousands refurbishing a building?

This episode is about learning to look at commercial property through a different pair of spectacles.

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In this episode, you'll discover:

• Why occupier demand should come before investment demand

• Why commercial value is driven by much more than the bricks and mortar

• How the tenant, lease, covenant and rent can transform the value of an investment

• Why a high yield can sometimes be a warning rather than an opportunity

• The question Suzi asks: "If this tenant disappeared tomorrow, who would actually take this building?"

• Why residential-style refurbishment isn't always the best way to create value

• How commercial investors can create value on paper through rents, leases, regears, breaks, planning and title

• Why a £1 million property doesn't automatically mean a lender will give you a £750,000 mortgage

• The commercial due diligence issues residential investors may never have encountered

• Why a fully let property isn't automatically safe — and a vacant property isn't automatically risky

• Why your exit strategy should start before you buy

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If you're a successful residential investor thinking about moving into commercial, the message isn't to forget everything residential property has taught you.

It's this:

Know which rules no longer apply.

Because residential investing often rewards you for understanding property.

Commercial investing requires you to understand property, leases, businesses, finance and the future demand for that asset.

Get that shift right and commercial property opens up a completely different way of investing — including the ability to create significant value without necessarily laying a single brick.

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Ready to Take the Next Step?

If this episode has made you realise there's more to commercial property than simply finding a building with a good yield, the next step is to learn how to assess a commercial opportunity properly before you put your money into it.

Join Suzi for the Commercial Property Blueprint, a full-day online training where she'll take you through how she approaches commercial property, assesses deals, identifies risk and finds opportunities to create value.

You'll learn the fundamentals you need to start looking at commercial property with an investor's eye — rather than applying residential rules to a completely different market.

Find out more and book your place at https://hub.commercialpropertyacademy.co.uk/blueprint or find out more about the training Suzi offers at  www.suzicarter.com

 And don't forget to subscribe to The Commercial Property Podcast so you never miss an episode.

If you know a residential investor who's starting to look at commercial property, send them this episode before they buy anything!