ReCasa Financial Blog

Many questions need to be answered before investing in real estate. One of those questions is whether to invest in commercial real estate or residential real estate. 

During COVID, many businesses were forced operate remotely. Some businesses found employee production remained at or above past levels and have continued some form of remote work to this day. As a result, some companies have sold, subleased, or reduced the physical space they operate their business from. Companies were able to save money by doing so, which in turn, caused issues for landlords who were left trying to backfill vacancies in a saturated commercial real estate market. With this trend likely to continue, investing in residential real estate is the route many investors take.

In Chicago, office space is being renovated to serve a residential use. This provides more housing in a land-locked area and will help the building owner fill the space.

Read more here - Few Empty Office Spaces Can Convert To Residential Housing, But Chicago Is Leading Other Cities In Making The Transition (yahoo.com)

Retail space is also on the decline. With online shopping the norm, retail companies have had to adjust their presence and measure their physical presence. 



The pros for residential investing outweigh the commercial arena in the current climate:

·       Lower tenant turnover

·       Depending on the location, fewer restrictions regarding renovation

·       Larger pool of potential buyers and renters

What pros would you add to investing in residential real estate over commercial?