Business Standard-Commercial real estate offers higher rental yield, but beware the risks
Delhi-based couple Jyoti and Rishi Arora recently chose to invest in commercial property, attracted by higher rental yields and the prospects of capital appreciation. They selected a 250-square-foot office space priced at Rs 80 lakh. “After extensive research, we selected a project in Sector 140, Noida, developed by a reputable builder,” says Jyoti. The presence of major IT companies in the area has strengthened their confidence in this investment.
Advantages of commercial real estate
Commercial property offers diversification beyond residential real estate. If occupancy rates are strong, it can deliver higher returns than residential rental assets. “Typical lease terms in commercial real estate are long-term, unlike the one-year rental agreements common in residential properties, thereby ensuring stable returns,” says Vimal Nadar, senior director (Research), Colliers India.
