Top 10 Cities to Invest in Commercial Real Estate

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The big success stories of the real estate investors read on news and the papers inspire many people to venture into real estate investing. However, many people do not really pursue on with this dream thinking investing in commercial real estate requires out-of-the-world brains and it is not everyone.

However, the truth of the fact is that real estate investing IS for everyone – for everyone who is interested and is willing to put in the required amount of work to get it right.

With that said, if you think you have the will needed to venture into real estate investing but do not know just where you can start from, this website is the best place to be, as we put together all important research resources you will need all at one place.

If you are thinking about investing in real estate and are wondering what are some of the best places where you can start investing, read this guide which provides an outline of the top 10 cities to invest in commercial real estate in the United States.  

5 criteria to consider to determine the best cities you can invest in

Before we talk about the list, there are some key factors you should consider and look into before making the decision of investing in commercial real estate.

In other words, these factors remain a constant in all the top 10 cities we have listed and they can be used as a yardstick to understand if a city is really a good place to invest your time and money into or not. Here are the top 5 criteria that determine if a city is a good place to start investing in:

#1 – Low unemployment rates

Cities that have lower unemployment rates are an indicator of the fact that there are more people in the job force, thus the demand for office spaces will be high. Besides, the demand for multifamily properties will be high too in such cities and thus it’s a big factor that makes a city a go-to option for investing.

#2 – Low vacancy rates

The cities with lower vacancy rates mean that you don’t have to worry about finding new occupants or new tenants time and again for your property. You will also save hugely on the expenses you would otherwise incur. Thus, it is a good idea to invest in cities that have lower vacant rates.

#3 – Low Purchase prices

Although this might seem like a very obvious factor, many people do not give it the importance it deserves and ends up buying properties at an overvalued price.

Remember that it’s always suggested to buy properties either at below or at pat market prices if you want to make some serious money with your commercial real estate investment.

There can be some exceptions to this rule, like, an ancient building with antique value where you might want to consider paying more than the market price, but in such cases, the rents you will typically charge will be high too and so it’ll be a balance. Ruling over the exception cases, always buy at lower purchase prices.  

#4 – High Tenant Demand

Another factor that makes a city a go-to option for commercial real estate investment is a high tenant demand. Look for places where there is a possibility of new industry coming up and growing there as there will be more residential and commercial spaces coming up and growing there soon.

#5 – High Asking Rents

The last must-have factor to determine if a city is going to be a good commercial real estate investment opportunity or not is if the city has high asking rents. Figure out by doing your homework through research about what the average rent asking rates are. If there are high asking rents, it is definitely a hot destination for you to invest in.  

These are the 5 big criteria you must look into before you think of investing in commercial real estate. Moving on, here is our list of top 10 cities to invest in commercial real estate:

1) New York and Brooklyn, NY

New York and Brooklyn continue to be on the top 10 cities that are the best place for making some serious money in commercial real estate investment venture.

Although, one may argue that entering these markets is rather difficult as it could be more saturated than other cities, the truth of the matter is that these cities are ‘evergreen’ when it comes to investing in real estate and there is always a good chance of making a fortune by investing in these cities.

They are undoubtedly expensive in comparison to other cities on the list, but they’re also more lucrative at the same time.

So if you are someone who is looking to make good money and are willing to invest in a slightly high-risk investment, New York and Brooklyn are go-to cities.

Besides, since New York and Brooklyn are known for being an international housing market for foreign investors, it is always a good place to have real estate in.

2) Dallas, Texas

Dallas remains to be one of the big cities to start investing in real estate. Even more so now with big population growth due to the low cost of living conditions and an increase in the labor market because of the ease of doing business in the city.

These factors make this metropolitan city a hot destination for people to invest in with its rocket speed economic growth. Besides, there is an increasing demand for rental properties in Dallas which makes it one of the best places to invest in.

3) Orlando, FL

The next best city to invest in the States is Orlando. Orlando is witnessing a huge population growth due to the city’s beautiful scenery, a better standard of living and beautiful weather.

It has become one of those cities that has the youngsters of The States considering to move in here and that’s a big plus for you if you plan to invest here. Besides, this city is also becoming a business hub for young entrepreneurs in the country.

4) Durham, NC

Durham is expected to have a great employment growth in the year 2019 and it is particularly most suitable for property investors who are looking out to rent out properties to the millennials. B

etter job opportunities, affordable housing, and proximity to the many universities in the city make it a hot destination to invest in multi-family properties and buy-and-hold properties.

5) Nashville, TN

With a strong job market and lowest unemployment rates, many people around the states are considering to relocate to the music city of the state – Nashville, making it one of the top cities to invest in 2019.

The purchase rates, however, are slightly higher but going by the increasing population growth, it’s a risk that can be taken. If financing is an issue, explore from the plethora of commercial real estate loans available which can have your back covered.

6) Boston, MA

Being one of the major tourist attraction cities, Boston is definitely a great city to invest both for investors looking to invest for short term and long term.

Besides, one notable feature with making a commercial real estate investment in Boston is the highly expensive houses, which makes its residents choose to rent out the properties instead of owing them per se.

Thus, it’s a great place to invest in, especially for investors with a big budget who can also make use of commercial property loans.

7) Charlotte, NC

Being one of the fastest growing metropolitan cities and listed on the best cities to live in in the United States, Charlotte has become the next move-in place for many young families across the state.

The real estate expert speculate a huge growth in the multi-family properties in Charlotte as there are steady population growth and increasing in-migration rates in the city.

8) Denver, CO

With a wide majority of the total population of Denver aged between 25-45, the city has seen an increase in the labor market making it hot commercial real estate investment cities.

Besides, Denver is also seeing fast and high investment activities happening in almost all the property types! So, Denver is not to be left out on the list.

9) Tampa, FL

An increasing population growth, employment growth, and the continued economic prosperity have made Tampa one of the go-to cities to start a lucrative commercial real estate investment in. The market’s affordability is yet another contributor in terms of making it one of the best cities to invest in in the year 2019.

10) Austin, TX

A stable economy, low cost of living and beautiful environment to live in has made Austin make it to the top 10 best cities to make a commercial real estate investment in. Besides, the stable economy offers high paying tech jobs, which makes it a hot destination for students who study in the universities in Austin to choose to live there by finding a lucrative job. Thus, it’s a good place to invest in for both residential and commercial spaces!

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