Investors in the commercial real estate space, well known to be one of the most lucrative and long-term asset classes, or investors looking to be a part of mixed-used real estate development, you are at the right place. However, if you are new to this you might be wondering, "How do I get started sourcing mixed-use real estate deals?” or thinking, “What is a mixed-use property?” It is a valid question and in this article we break down what you should be on the lookout for while underwriting deals.

How to Source Mixed Use Real Estate Deals

There is no one particular way or place to go and do this. Our first suggestion is to make connections and build relationships with local brokers, property owners, and property management companies. Letting industry professionals know that you are in the market can lead to off-market opportunities and with time, you can get access to more and more mixed-use deals.

What to Look for in a Mixed Use Real Estate Deal

Multiple factors need to be considered when evaluating multi-use real estate and whether or not it is a good investment for you. Here are the three most important things you need to look for when you are considering a multi-use real estate investment.

• Location As you must be aware, the location of the property is a very important factor when it comes to real estate. Therefore, when you plan to invest in any real estate deal, consider the location first. There are some things specific to the location like proximity to hospitals, schools, or medical facilities that you need to look out for. Access, visibility, and even the municipality can drastically affect values. Verify that the submarket has seen steady economic growth over the past few years and is forecasted to continue trending upward.
• Possible Return on Investment While you are looking at the possible cash flow or return on the investment, you will want to consider a couple things: whether the property is an existing one or whether it is being constructed from the ground up. This is important when looking at multi-use real estate since it will help decide when you might expect to see returns. Based on the type of property you plan to invest in, you will also want to consider external factors like current interest rates, taxes, additional mortgage terms, and utilities.
• Minimum Investment Well, this might sound like an obvious one but it is important to point out since it is easy to overlook. A lot of multi-use real estate investments will require a minimum investment amount in order to be involved and finding an opportunity that fits your financial situation is of crucial importance. Keep in mind that joint-ventures can be set up a myriad of ways, so always consult with legal or other professional counsel to ensure you understand the details of your investment.

Why Focus on Mixed Use Real Estate?

Investing in mixed-use real estate can have a number of benefits over other property types. We love that mixed-use properties are often located in denser neighborhoods with good street traffic and usually feature a vibrant tenant mix. Here are a few other benefits of mixed-use real estate.

• Stable Cash Flow Since these properties usually contain commercial businesses as well as residential tenants, there is a diverse income stream generated by the properties. It creates an environment where cash can flow regularly even during tumultuous times.
• Attractive & Interesting Mixed-use projects can look extremely cool and attractive which helps them draw the interest of residential as well as commercial tenants. The commercial businesses can serve as an amenity for the residents, and the residents are viewed as “bvaked-in” customers for the business owners.
• Longevity A lot of mixed-use real estate deals bring strong opportunities to produce positive returns for the long haul due to tenant diversification. If you want to be in an area that is up and coming, the growth potential becomes massive and could make your investment even more lucrative.

Investing in mixed-use real estate can provide consistent returns and stable growth but choosing the right asset will make all the difference. Contact Us Now for More Information Phone: 314-588-1900