When most people think about commercial real estate, they think of high-rise offices or apartment buildings in big cities and check with a lot of zeros changing hands. That’s rather a rather limiting view, though. Most commercial real estate is neither big nor flashy. Think about the office buildings in your downtown area, the strip mall with the stores you need, or the duplexes in your neighborhood. All of these represent commercial real estate on a smaller scale.

Getting Started

If you’re looking to be a commercial real estate investor, you need to do a little preparation in advance of seeking your funding. First, what’s your credit score? You’ll need to know that. You’ll also need to take whatever steps you need to ensure it’s a good score. Clear up any discrepancies on your credit report, pay down the debt you have, and maintain a habit of making on-time payments. These three things can go a long way towards improving your score.

What is your collateral? You could probably take out a personal loan to get started investing in commercial real estate, but you’ll be restricted as to how much you can borrow. You’ll enable yourself to borrow a lot more if you go after the right kind of loan. A commercial mortgage lender will loan you more if you provide adequate collateral and your well-prepared financial and tax documents. You’ll also need to have a property in mind already so the lender can look at whether that property is worth the investment.

What’s Your Type?

Also, you should ask yourself about which kind of commercial real estate you are looking to invest in. Often, commercial real estate is small. For example, you as a homeowner rent the apartment space over your garage or the other half of your house if you’ve purchased a duplex. This works in a business environment, too. You as the business owner own the building out of which your company operates. You rent out the other spaces in that building to other businesses who pay you rent. In some downtown areas, your building may have apartments above the businesses for you to rent also.

You could also choose to invest in the strip mall or other commercially-occupied buildings. You don’t have to be a small business owner yourself to own all or part of those buildings. Don’t forget to invest in apartment complexes or other residential rental properties.

Commercial real estate holds many opportunities for savvy investors.