In case you are interested to join the real estate industry, it is important to have a guide and direction so that you can determine where you feel suits your purpose. Real estate industry is diverse and classified into various categories as we will see below. The industry is quite old and new interested investors may not be aware of the different categories that the industry plays around. Each of the different categories of real estate industry has its own advantages and disadvantages but the goal is to find which suits most of your purpose. Whether your purpose is owning, flipping, renting out or developing it, the following are the different categories of real estate investments intent;
Commercial Category
This category of real estate investment is seen with the intent of generating profits or for business oriented activities. This type of investment is mostly practiced to lease out to business owners especially office spaces and skyscrapers. The goal is to pay for the building-that is rent. It focuses on big companies and has stability in its cash flows. Most of such buildings have conditions attached to them while being rent out. They are commonly found in towns and centers that have a huge flow of economic activities.
Industrial Category
This category of real estate investment focuses on property that is used for production and manufacturing purposes. Factories, warehouses and commercial buildings that are focused on production process are placed in this category. They include; research centers, development parks, warehouse as well as heavy manufacturing plant buildings and property associated with industrial parks.
Residential Category
As the name suggests, this is the category of real estate investment where property is focused for residential purposes (living purpose). They include houses, apartments or townhouses with the purposes of sheltering, whether a single family of a multi-family residential sheltering.
Retail Category
This category is characterized with sizable stalls that are mostly for business use. In Kenya, some of these are semi permanent especially if outside the city while those around the city are permanent. The owner may have direct interaction with the tenants or alternatively hire an agent. They are mostly suitable for middle class earners.
Mixed Used Category
An investor can choose to have all the above and blend them in such a way that they fit in one space. According to commercial Kenya, mixed use complex is a development, a building, complex of buildings that is developed for mixed use by a private developer or those who combine the above four categories into one single project.
In conclusion,
Understanding your purpose of investment and all the risks that are associated with them, it will be easier to plan on what you need and how to generate profits.