Website design By BotEap.comThe different types of investment properties that real estate investors consider vary in many different ways. We will identify the different types in this article and briefly discuss each one. We will also discuss the different ownership structures available. The basic types of investment properties include retail stores, offices, apartments, mixed developments, and hotels/motels.

Website design By BotEap.comCommercial properties include freestanding buildings and shopping centers. An independent building is one in which you are alone, with no connection to any other. Malls range from strip malls to super regional malls with many stores located in one area.

Website design By BotEap.comOffice properties can be small (one, two, or three tenants), office parks where there are many buildings serving different businesses, or high-rise complexes where many tenants are located in one building. Most will be located in downtown urban areas or in or near suburban towns/developments.

Website design By BotEap.comApartments range from multi-family or “mother-daughter” housing to commercial units. A commercial apartment building will consist of at least 5 units. The larger the apartment complex, the greater the need for on-site property management.

Website design By BotEap.comMixed developments consist of a mix of residential apartments, houses and condominiums with office and retail space. Many communities that are growing at a fast pace have developers who maximize the feeling of community by mixing all the different types of structures, creating small neighborhoods with all the essentials of a small town, such as restaurants, entertainment, jobs for the local public, and of course, go shopping.

Website design By BotEap.comHotels and motels require excellent management to be successful. Their locations near airports, business parks, city centers and other active areas help keep their doors open. Its failure rate is relatively high and it must be managed correctly to stay in business.

Website design By BotEap.comThese are the basic types of investment properties. Single-family housing is of course a consideration, as are other types of investments, however the properties featured in this article are attractive due to their income potential.

Website design By BotEap.comThere are several different types of ownership and ownership structures. These are generally known as business entities in which investors own real estate. To keep things simple, we’ll just cover the basics of each structure and how each possesses properties.

Website design By BotEap.comA corporation is considered a legal person. It is a separate legal entity. The corporation conducts its business in accordance with the state law where the entity was created. The key here is “separate legal entity.” Because the corporation is considered a legal person, real property is considered owned by a single person, the corporation.

Website design By BotEap.comThe administration of the corporation depends on its board of directors, which is elected by the shareholders. The important point here is that anyone who wants to form a corporation and buy real estate should talk to a lawyer about how to properly run the corporation so that they operate the corporation in accordance with state and federal laws (if applicable).

Website design By BotEap.comAnother business entity that is becoming more popular is the Limited Liability Company. This business entity takes advantage of the same type of liability protection as a corporation, however, it differs from the corporation in that it takes full advantage of the federal tax benefits and flexibility of a partnership. Again, consult with your attorney to take full advantage of the benefits of this “pass-through” entity. Real estate ownership is also different and it is advisable to consult an attorney to discuss how the LLC takes possession of the property.

Website design By BotEap.comSome of the other entities include real estate investment syndicates, both private and public organized into a corporation, limited liability company, general partnership, or limited partnership. Syndicates typically involve one or more projects and different types of ownership (tenancy in common, joint tenancy, etc.).

Website design By BotEap.comIn conclusion, it is very important that the new investor has at least a basic understanding of the different types of investment and ownership properties. It is often something new investors overlook due to the complex nature of learning the business of investing; However, without at least consulting a lawyer and doing some reading, the new real estate investor is bound to make costly mistakes that are definitely avoidable. It’s a great thing to learn from mistakes, however making stupid mistakes like avoiding education due to lack of patience is just plain silly.

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