Office condominium investments are good investments in both good and bad economic times and in hot and cold real estate markets. Here’s why: office condos are typically leased to a single tenant for five to 10 years at pre-set rental rates. As an owner, you know exactly who will be the tenant, how long that tenant will be there and exactly how much rent it will pay you. That means you will derive a steady income from your investment regardless of how the economy or the real estate market is performing.
As with other forms of real estate investment, over time office condo investments provide increasing rents and appreciating property values. Additionally and very importantly, office condos are typically almost management free.
Office condominium buildings are managed by professional property management firms. The investor pays monthly common charges in lieu of managing and maintaining the building.
Typical office lease terms are five to 10 years. This provides an investor predictable monthly cash flow with low tenant turnover.
Office condominium units are typically occupied by one tenant which requires less supervision and maintenance than multi-tenanted properties.
Office leases escalate annually and the rate of return increases in excess of inflation.
In the first quarter of 2016 New York office buildings sold for an average deal size of $330 million. Office condominiums offer modest, non-institutional investors the opportunity to partake in the long-term benefits of investing in the New York office market. Office condominium investment units range from under $1 million to over $50 million.
Many lending institutions are offering competitive financing terms and high loan-to-values. Interest rates remain at historically low levels.
Office condominium investments are like all-weather tires. They are good investments in both good and bad economic times and in hot and cold real estate markets. Here’s why: office condominiums are typically leased to a single tenant for five to 10 years at pre-set rental rates. As an owner, you know exactly who will be the tenant, how long that tenant will be there and exactly how much rent they will pay you. That means you will derive a steady income from your investment, regardless of how the economy or real estate market is performing.
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