A profitable business is leasing commercial real estate. Subtleties and nuances

20.01.2024

Or a commercial offer. It is necessary to characterize your property in detail: indicate the size, number of floors, area, describe the technical condition and equipment, infrastructure, while the emphasis, of course, should be placed on its advantages, but the disadvantages should also be noted.

The most effective ways to find tenants are as follows:

Placing advertisements on Internet resources(specialized) is a very popular and effective advertising channel. You should definitely add photos of the property.
Search by your friends- a very simple method, but often works faster than others, since the social circle of entrepreneurs implies the intersection of interests in the business sphere.
Sending a commercial offer by email– quite often establishments such as restaurants, cafes, bars, shops, salons and others select premises to open another outlet or to move. Since usually the email address of business owners is indicated on the official website of their company, it is not at all difficult to make a specific targeted mailing.
Cooperation with a real estate agency– a very good way, because realtors have greater advertising opportunities. In addition, they will be involved in concluding the deal in the future.

What to pay attention to?

Pricing

First you need to familiarize yourself with the commercial real estate database, evaluate the market, and compare prices. However, you need to understand that when concluding real transactions, the amounts are usually slightly reduced.

Competitive advantages

It is quite possible to speed up the terms of leasing commercial real estate by changing the quality characteristics of the premises. Various options are possible:

Also, the advantage will be the reliability of the owner and transparency, that is, a long-term direct contract including VAT, a non-cash form of payment, the ability to take into account not only all amounts under the contract, but also operating payments for tax purposes.

Bonuses and preferences

Typically, commercial real estate owners prefer not to advertise the possibility of providing various bonuses and discounts. Everything is decided on an individual basis, for example, if the company cannot decide to rent premises, you can offer some bonuses. They can also become just the decisive factor for making a positive decision. You can learn more about the legal aspects and benefits of renting from the owner.

Ways to find the target audience and which one is more profitable

Search methods can be done independently or with the help of real estate agencies.

On one's own

When searching for tenants on your own, of course, a lot of time will be spent, even if the contract is drawn up perfectly. In this regard, it is more profitable to turn to professionals (realtors).

As for the price, it is more profitable to search on your own; the costs are naturally lower. The risks in this case may be:

It can be difficult for a non-professional to properly assess a premises and identify its strengths and weaknesses. And the cost of rent depends on this.
It is possible to draw up a commercial proposal taking into account not all important nuances.

When contacting realtors, you can do other things and entrust the search to professionals.

With the help of a realtor

Precious time is saved significantly, since realtors have their own established bases and advertising methods. Their services, of course, will need to be paid; usually the amount is set within the commission from the delivery of real estate.

To avoid risks, You need to conclude a cooperation agreement with the realtor and pay attention to the nuances:

Realtors always include a clause in the contract that the owner cannot hand over his property on his own, which means that the realtor will receive a remuneration in any case.
You cannot sign an agreement until it is verified that the realtor acts as a legal entity and is registered in the Unified State Register of Legal Entities.

Who to give preference to?

When choosing tenants, preference should be given to legal entities or individual entrepreneurs, these are the most reliable categories; they usually rent not the first premises when expanding their business.

Renting out premises to individuals is unsafe, as they can refuse to pay rent, declaring that there is no money, or simply disappear.

Possible risks

Of course, every owner of commercial real estate is worried about its safety and condition, because the goal of renting out is to make a profit. The main risks for landlords can be identified:

Inappropriate use of premises. For example, the tenant indicated in the contract that the premises would be used as a warehouse, but in fact a store was opened.
Damage to property, that is, equipment may break down, repairs to the premises may be damaged, etc.
Tenant's refusal to pay rent.

We talked in more detail about how to rent commercial real estate so as not to get into trouble in.

How to submit?

When leasing commercial real estate, it is very It is important to correctly prepare all the necessary documentation:

make a commercial offer;
prepare a lease agreement, in which it is necessary to specify in detail all the terms of the transaction for both parties;
draw up an act of acceptance and transfer of premises for rent.

A commercial proposal, at its core, is a dialogue with a potential tenant, so when drawing it up, you need to try to imagine yourself in his place. The result should be a presentation of information that would definitely attract people and no longer want to look for another option.

There are offers:

personalized, that is, targeted;
not personalized, that is, addressed to everyone.

When compiling it, it is most convenient to adhere to the following structure:

Title.
The essence of the proposal, here you need to indicate the purpose of the premises being rented: office, industrial, warehouse or retail.
The exact address of the object.
Main properties and characteristics: area, Internet and telephone availability, alarm system, parking, etc.
The terms of cooperation are indicated: the cost of rent and what is included in it, additional services and additional conditions.
The advantages of this proposal are possible: high traffic, the presence of well-known companies among the tenants or the proximity of transport hubs.
Contact details.

Attention! Attach also photographs of the exterior of the building, a view from the inside and a photo of the entrance lobby.

Drawing up and concluding a contract

Article 609 of the Civil Code of the Russian Federation. Form and state registration of the lease agreement

A lease agreement for a period of more than a year, and if at least one of the parties to the agreement is a legal entity, regardless of the term, must be concluded in writing.
A real estate lease agreement is subject to state registration, unless otherwise provided by law.
A property lease agreement, which provides for the subsequent transfer of ownership of this property to the lessee (), is concluded in the form provided for the purchase and sale agreement of such property.

The state duty for legal entities is 22 thousand rubles (Article 333.33 of the Tax Code of the Russian Federation).

How to protect yourself?

In order for the owner of the property to protect himself, it is necessary to clearly state in the contract all the important points and conditions of the transaction: contract term, rent amount. You should only enter truthful information; trying to win something on taxes, you can lose more.

Important! The contract must be concluded only in writing!

After all, the Civil Code regulates the relationship between the parties involved in the transaction, provides for obligations regarding the maintenance of property (Article 616 of the Civil Code of the Russian Federation), and liability for the use of rental property not in accordance with the agreement (

Conclusion

Commercial real estate should not be idle, it should work and generate income for its owner. And for this income to be stable, you need to invest in commercial real estate that will always be in demand among tenants in the future. Therefore, you should never rush to make a choice; you need to carefully check and calculate everything.

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The rental business has been and remains popular for many years, since many people do not have the opportunity to purchase housing, and companies seek to reduce the level of one-time investments in development activities. The range of objects that can be provided for rent is constantly growing: at the moment you can even rent out such things as roller skates, skis, etc. - everything that is not in constant demand, but is an object of seasonal use.

However, the most common option is still renting a property. In order to receive a certain income from the provision of a particular premises for rent, it is necessary to take into account a number of nuances that will be discussed in this article.

It is necessary to understand that real estate is usually classified into 3 groups – land, housing and non-residential premises. The most common types of services in this market are the provision of rental housing and non-residential premises.

Among non-residential properties, commercial real estate is usually rented. At the same time, all reputable analytical agencies identify the following types of it:

office rooms;
trading;
warehouse;
industrial.

In addition, some organizations rent a separate type of premises - the category “for special purposes”. Here buildings are allocated for kindergartens, schools, hospitals, churches, etc.

In addition to real estate, you can rent out land, gazebos, equipment, cars, special equipment, inventory and much more. However, this is a rarer and more complex form of business.

What's the best deal?

If we talk about residential real estate, the average cost of a one-room apartment 10-15 minutes from the metro in a residential area in Moscow will cost 5-6.5 million rubles. At the same time, the average rental rate for such rooms is about 25-30 thousand rubles. As a result, when calculating, it can be obtained that the minimum payback period for a one-room apartment will be about 15 years.

Accordingly, this option cannot be called very profitable from an investment point of view: the only case in which this can really pay off is when the housing is inherited.

If we talk about office premises, they are somewhat more expensive than residential ones, since their location should be in more accessible places, and their area is larger. In Moscow, a small office space will cost 6.5-7.5 million rubles, provided that the area is about 60-70 square meters. In this case, the rental rate will be calculated per 1 square meter.

According to the Knight Frank agency, at the end of 2015 the rental rate for class A offices was about 25 thousand rubles, and for class B office premises - about 15 thousand rubles per year. Accordingly, the maximum payback period will be about 8 years.

Retail premises are even more profitable to rent out than office premises - their payback period is 5-6 years. But there is an important limitation: for such real estate, location is one of the key factors. The premises should be located in a central area, in an area with high traffic levels. Finally, it must be well executed.

In general, commercial real estate is inferior to residential real estate in only one parameter: the level of risk, since it depends on the economic situation in the country and a particular city.

To learn where to start and how to develop such activities, watch the following video:

How to organize such a business from scratch?

First of all, you need to find a suitable premises for rent. In the case of inheriting living space, the procedure will begin with the preparation of documents confirming that the entrepreneur is the owner of the property.
In a situation of searching for a ready-made premises, it is best to turn to the services of professional agencies who will help assess the real cost of housing or commercial real estate: an inexperienced businessman can easily miscalculate.
Next, you need to complete the necessary documentation for the property. If this is commercial real estate and you plan to rent it out to special organizations (for example, those working in the catering industry), you must take care of obtaining additional permits and conclusions from certain services.
After completing the initial documentation, it is necessary to carry out redevelopment and repairs: in the case of residential real estate, it is important to purchase a certain set of furniture and household appliances, since apartments in which you can live immediately after moving in can be offered at a higher cost. In the case of commercial real estate, it is important to focus on increasing the free space and the possibility of subsequent redevelopment to suit the client’s needs.

In Russian practice, many people rent out residential real estate without concluding a contract - this allows them to get rid of the personal income tax of 13% and reduce the payback period. However, this is associated with certain risks - in particular, those associated with the unreliability of clients. Therefore, both in the case of non-residential and residential real estate, it is necessary to formalize the relationship with the tenant.

Where to look for clients?

Finding clients through standard advertising options (placing ads in public places or print media) is not effective within the rental business. Advertising can be carried out through social networks (this is especially true for the situation of renting out residential real estate) - here the “word of mouth” effect will work.

In addition, posting on thematic sites and forums is suitable. For retail premises, especially those located in shopping centers, it is possible to post a “for rent” sign with the owner’s phone number. This will expand the circle of potential customers to all visitors to the shopping center.

Finally, there are 2 more fairly effective ways to find clients - maintaining a thematic website or blog with unobtrusive advertising of services as a landlord, as well as distributing brochures and business cards.

Necessary costs

If an entrepreneur is going to engage in such a business, he must understand that among the main cost items it is necessary to include redevelopment costs: in this case, clients are ready to enter into rental agreements at much higher rates (the difference can be up to one and a half times). This happens because after redevelopment, the percentage of usable area most often increases, in addition, the room can be changed to suit your own needs.

Among the costs it is also necessary to highlight:

Expenses for construction or acquisition of premises.
The cost of services of a specialist who can estimate the market price of real estate.
Expenses for maintenance and security of the premises.
Costs for electricity, water supply, etc.

Underwater rocks

One of the pitfalls is determining the optimal investment of money. Often, inexperienced entrepreneurs incorrectly assess the value of a particular premises, thereby investing in illiquid objects, losing a large amount of money.

In addition, it is important to pay attention to the legality of the business, changes in legislation and the process of paperwork (primarily this applies to commercial real estate).

Please note that tax legislation in the rental business is constantly changing.

When calculating costs and the level of payback, it is necessary to determine several development options - optimistic, most realistic and pessimistic in order to determine the approximate payback period of the object, as well as the fact of how to diversify risks. It is imperative to have other sources of income in order to insure yourself against a situation of lack of money.

Pros and cons of this area

This type of business, like others, has a number of advantages and disadvantages that arise from its characteristics. Among the disadvantages, the main one can be highlighted - the search for a tenant can take many months (primarily this applies to industrial facilities and retail real estate in impassable places). As a result, even a high rental price will not be able to compensate for the financial costs that the lessor will have to bear during the entire period of downtime.

Also among the disadvantages are:

a fairly long payback period;
not very high level of profitability;
high level of initial costs.

In this situation, the only rational option is to purchase liquid property (one for which there is always a certain level of demand). To do this, it is important to have a good understanding of this area or seek the services of a specialist.

Among the advantages of business are:

long-term contracts for a period of one year or more;
stable level of profit;
the income will be received by the lessor constantly;
passive nature of making a profit (the landlord does not need to expend any effort after signing an agreement with the tenant);
the possibility of organizing a business without registering as a legal entity.

Thus, the rental business is quite an attractive area for earning money. However, it is best to combine it with other sources of income in order to insure yourself against possible risks.

How to preserve and increase your savings in conditions when the ruble exchange rate is unpredictable? The most understandable and reliable way is purchasing real estate. As a rule, people buy apartments. However, rental yields today may be even lower than modest rates on bank deposits. It's time to pay attention to commercial real estate.

Start-up capital

If you think that investing is an activity exclusively for people whose wealth is expressed in numbers that go to infinity, then you are mistaken. In fact, an investor is any person who invests his funds in a particular project with the aim of making a profit. If you are renting out an apartment that you inherited from your grandmother, you are essentially an investor too. Although not particularly successful, since your income is small.

Start-up capital for investment in commercial real estate is comparable to funds for the purchase of housing, says Denis Kolokolnikov, chairman of the board of directors of RRG, chairman of the expert council on redevelopment of the RGUD. For example, for 7 million rubles you can buy a one-room apartment in Moscow or several office blocks in an administrative building, class B or C business center. If you find an apartment on the housing market costing less than 140-150 thousand rubles per sq. m. m is almost impossible, then office space is sold at a price of 90-100 thousand rubles per sq. m. m, explains the expert.

Even with an amount of 3 million rubles, you can buy an office block with an area of 20-30 square meters. m

By purchasing commercial premises, an investor receives rental income at least one and a half times higher than income from renting out an apartment, experts told CIAN. For example, explains Denis Kolokolnikov, for 7 million rubles you purchased a two-room apartment with an area of 50 sq.m. in the capital. Today you can rent it out for a maximum of 45-50 thousand rubles per month. A commercial premises of the same area can bring the investor at least 75 thousand rubles.

“This difference in price is explained not only by high demand. Residential real estate is rented as a separate object (apartment), and the cost of renting commercial real estate is calculated per 1 sq. m. m per year. Rates for commercial premises with a favorable location can reach up to 300 thousand rubles per sq. m. m,” explains Hasan Arkhulaev, managing partner of GR ProJect Group.

advantages of investing in commercial real estate

High profitability - from 8 to 12% per annum, depending on input conditions and rental rates. This is double the rates on bank deposits.
Receiving income is stable and does not require much effort from the investor. The repairs are done by the tenants themselves, the space is leased by brokers, and the premises are insured by an insurance company at the expense of the tenant.

Anton Belykh, CEO of the consulting company DNA Realty

Costs and risks

Meanwhile, the process of acquiring and maintaining commercial real estate requires O greater effort and material costs compared to buying a home. The owner of commercial real estate will not be able to avoid paying taxes (unlike some unscrupulous owners of rental housing). Most often, the problem is solved by creating an individual entrepreneur, and the owner of the commercial premises pays 6% from turnover.

Certain costs may be required for brokerage services ( from 50% to 100% of the rental rate per month), if the investor decides to entrust the search for a tenant to agents.

An accountant is needed to service payments. As a rule, freelancers are used for this; their services are inexpensive.

Irina Berbeneva, head of the office “In Krylatskoye” of the MIEL-Network of Real Estate Offices, reminds: if an investor decides to buy residential premises (for example, an apartment on the ground floor), it will have to be converted into non-residential ones, these costs also need to be taken into account. The costs will still be from 500,000 thousand rubles and above.

As Anton Konovalov, director of the retail real estate department at Penny Lane Realty, notes, the main risk for the owner of a commercial premises is the departure of a tenant and a long search for a new one. However, as a rule, the agreement stipulates the conditions according to which the tenant must notify the owner of the termination of the lease agreement in advance. The deadline is negotiated by both parties.

Right choice

Typically, the search for suitable premises takes from two months to six months.

The level of profitability directly depends on the location. Hasan Arkhulaev, managing partner of GR ProJect Group, emphasizes that the location of the property on the first line in places with high traffic and good visual accessibility are the most important conditions for most formats of commercial real estate - from cafes and restaurants to grocery stores.

When choosing a room, you must definitely check the quality of the walls, enclosing structures, drainage, and inspect the basements (it is important that there are no signs of flooding). The fewer corners and columns there are in the room, the better.

The ideal layout is a rectangle. If the tenant needs partitions, he will build them himself during the renovation.

Level of investment and profitability of real estate in Moscow

Investments	Residential Properties	Income	Commercial real estate	Income
3 million rubles	Studio up to 16 sq.m. m		office block in a class B business center with an area of up to 30 sq. m
7-8 million rubles	One-two room apartment		Office blocks with a total area of 70-80 sq. m; commercial premises with an area of up to 50 sq. m in a house under construction
10-15 million rubles	Two-, three-room apartment		Commercial premises on the ground floors with a separate entrance and good location.

Commercial real estate includes non-residential premises that can be used for commercial purposes. Lawyers distinguish several groups of commercial real estate:

If a novice entrepreneur decides to start a business, first of all it is necessary to properly prepare the premises for use by tenants. If necessary, repairs should be made that meet modern standards, the necessary communications should be connected, and much more.

How to file a case?

Such a step as registering a rental business (Federal Tax Service) is perhaps the most important. The exact decisions on the organizational form depend on the line of business itself. In other words, if a citizen rents out non-residential premises, he is obliged to pay income tax.

It is recommended to obtain the status of individual entrepreneur (individual entrepreneur), thanks to which a person will receive the right to conduct activities on completely legal grounds. Due to the fact that the profit from renting out commercial real estate will be small, according to the law, a citizen has the right to apply for a simplified form of taxation. It provides for the payment of taxes in the amount of 6% of total income.

To register a business for leasing commercial real estate, the following documents are required:

A copy of the founder's passport.
TIN (individual taxpayer number) of the founder.
Contribution of authorized capital from 10,000 rubles. When submitting the appropriate application for registration of an individual entrepreneur, a bank statement is provided where you need to open an account.
Formation of the company's charter. According to this documentation, the distribution of parts between the owners (if there are several of them), the official name of the company, and its legal address will be carried out.
Minutes of the founder's meeting (if there are several of them).
Decision on registration of an LLC (society with limited capabilities).

The period for registration of an individual entrepreneur is from 3 to 5 working days. It will take no more than 14 days from the date of application to complete and register LLC status.

We divide the rental area into parts

Not all clients are ready for office space: most need a certain part of it. So, for example, a bar-restaurant or a gaming club can be located in a hotel lobby. Moreover, both establishments are owned by different persons.

For several tenants to share the premises. Division is the cessation of the existence of a single object and its division into several separate objects, each of which will receive a unique cadastral number and separate documents for the right of ownership. According to the legislation of the Russian Federation, such objects become newly created, as a result of which, according to Article 219 of the Civil Code of the Russian Federation, the owner receives the rights to dispose of them only after official registration.

Article 219 of the Civil Code of the Russian Federation. Emergence of ownership rights to newly created real estate

The right of ownership to buildings, structures and other newly created real estate, subject to state registration, arises from the moment of such registration.

According to the legislative standards of the Russian Federation, the division of a real estate property is permissible if one of the grounds exists:

Consent of all property owners to its division and certification in writing by a notary.
Intervention by the courts.

Before competently dividing existing commercial real estate into parts and renting them out, the copyright holder is obliged to organize technical and cadastral records of the premises, as well as officially register the right to manage it. After registering the necessary part of the object in his name and registering the agreement with Rosreestr, he will be able to transfer it for rent.

To divide existing commercial real estate into parts, owners will need the following documents:

The owner will be able to purchase cadastral documents after contacting the authorized bodies and registering the property for cadastral registration. Since 2012 To install the premises for cadastral registration, you will need a detailed diagram of the building, which can be compiled by a highly qualified engineer.

It is worth noting that when subdividing commercial real estate, several technical plans must be provided. Document registration takes place within 18 days from the date of submission. After this period, the customer must contact the cadastral center and obtain documents (including a cadastral passport). In case of refusal to register, civil servants provide reasonable confirmation in writing.

After receiving cadastral documents, you must also obtain a certificate of ownership for each part of the premises. The most important and only document confirming ownership rights is the cadastral passport. It contains detailed information about the division of real estate and a technical plan drawn up in accordance with updated data.

You can invest in real estate in different ways and sizes: buy and resell apartments, rent out premises or open a real estate agency.

It is worth noting that not every average Russian citizen has access to this method of earning money - multi-million dollar investments are required. That is why commercial companies have and invest such large financial resources. Their privilege is to receive a loan for the project. An individual can also start a real estate business only if he has the necessary start-up capital.

Important! Purchasing housing during a period of growth guarantees the investor a multiple return on resale - by 10-15%. For the most part, this concerns those citizens who invested large material savings in this area in the 80-90s. XX century.

You shouldn’t expect a rush effect until 2020 – the Russian real estate market has stagnated in a downward phase.

Calculation of possible profit, payback period and profitability level

Scheme for calculating possible profit from leasing real estate:

Assessing the attractiveness of a rental business is not a major task. For a correct calculation, it is enough to compare rental income with the cost of real estate - in the end you will get the payback period of the business, which is the main criterion for business in this area. Standard payback periods for commercial real estate range from 9 to 12 years. Real estate with a payback period of 7-8 years is difficult to find.

The optimal investment option is to buy real estate in new buildings. A less expensive option would be to purchase premises at the foundation pit stage. Thus, the savings will be at least 30%.

However, there are a lot of certain risks in the shared construction system. At an early stage, their likelihood is enormous. To reduce possible risks, you should choose developers with excellent experience and a proven reputation.

Where can I get start-up capital?

Every citizen can receive start-up capital for business development. There are several ways to finance and find sponsors.

You can get start-up capital to start a business from a bank. The method is effective and popular. However, there is a huge disadvantage - risk. If things do not go in the right direction, then, in addition to a significant loss, the aspiring businessman will also receive a large financial debt. It is worth noting that Sberbank and Tinkoff provide loans for starting a business.

Reference! Government agencies involved in supporting small businesses can become a source of start-up capital. According to the federal system of self-employment, unemployed citizens can qualify for a subsidy in the amount of 60,000 rubles.

Advantages and disadvantages

Renting is the only type of business that provides legal passive income.

Minuses:

It is important to understand that income depends directly on the activities of tenants. Their activities should be monitored to ensure that the premises remain in good condition.
According to the provisions of the Ministry of Finance, the landlord is required to pay taxes in the amount of 15 to 17% of the amount received from the rent.
Inconstancy of tenants. A termination of the agreement may occur even if an official agreement is concluded, as a result of which the income traffic will temporarily cease, and the lessor will have to.

The presence of responsible tenants makes a business a high-quality and sought-after product that can be sold at any time and get a profitable financial position.
An annual increase in rent contributes to the successful prosperity and development of business.

If you have no experience in business, it is recommended to purchase a working ready-made business. The main advantage of this business is the conclusion of a contract with tenants interested in renewing the contract with a new partner.

Conclusion

Thus, a real estate rental business is an excellent source of passive income. However, this area has its pitfalls: assessing all kinds of risks, completing documentation, start-up capital, etc. Proper organization of a business contributes to its active and favorable development.

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The NDV-Real Estate company recently stated that when renting out premises, investments in offices pay off 3 times faster than in apartments. Real estate market experts generally agreed that offices pay for themselves faster, but they noted that the difference in payback is not so high, and also cited a number of pitfalls that make investing in commercial real estate much more difficult. TOLD AND CHECKED

TOLD

NDV-Real Estate Company:

. when renting out premises, investments in offices pay off 3 times faster than in apartments;

Making money by renting out housing is beneficial for those who received an apartment as an inheritance or as a gift, but if we are talking about an investment purchase, then it is better to forget about residential real estate. Investments in an apartment will pay off for many years. Another thing is office space.

For clarity, the company’s experts provided the following calculations:

The standard cost of an ordinary one-room apartment in a residential area (on the secondary real estate market) is 5.5 - 6 million rubles, and an adequate rental rate is approximately 27 thousand rubles. Thus, the payback period for the apartment can last 19 years.

Evgenia Borzova, head of the commercial real estate department at NDV-Real Estate, gave several illustrative examples of office space. For example, an office in the Dorohoff business park with an area of 65 sq. m and cost 7.35 million rubles, taking into account the indexation of the rental rate, will fully pay off in 6.5 years (current rental rate: 13.5 thousand rubles sq.m / year). And if you buy an office in the Atmosphere business park (Mendeleevskaya metro station) with an area of 119.8 sq.m for 285.5 million rubles, then it will be possible to “recoup” the investment in 7.5 years (at a rental rate of 24 thousand . rub. sq.m/year, taking into account indexation). It takes the same amount - 7.5 years - for more expensive real estate to pay for itself: for example, a retail space for 50 million rubles and an area of 80 square meters. m, located near the Novokosino metro station.

Judging by the above calculations, it turns out that buying commercial real estate is 3 times more profitable for a rental business than residential real estate. Let's see what other market participants say about this.

VERIFIED

Offices actually pay for themselves faster than apartments, but the difference is still not 3 times, but 1.5 - 2 times.

Managing partner of DNA Realty Anton Belykh And Head of the rental department at Delta Estate Stanislav Titorenko They believe that investments in an office still pay off 3 times, and 1.5 - 2 times faster.

“The fact is that with apartments, the payback period can be significantly reduced by selling a new building purchased at an early stage of construction immediately after the house is handed over to the state commission (as a rule, this is 2 - 3 years with a yield of 20 - 30% per year), - explained Anton Belykh. - With commercial space the situation is more complicated, since the demand for them is limited, so the sale may take longer, unless, of course, we are talking about particularly liquid places and areas. But this is if we consider the investment cycle of construction. As for the rental business, the payback period for retail and office premises is definitely higher.”

Retail facilities are more profitable than offices

“For example, the payback period for a two-room apartment is approximately 14-16 years, for a retail space in a good location - 6-7 years, and for an office space - 8-9 years,” clarified Anton Belykh. I agree with this and Development Director of Miel-Commercial Real Estate Elena Mishina, adding that from retail real estate we need to focus on street retail. “If a rental apartment brings an average of 4-5% per annum and pays off in 18 years, then liquid street retail properties yield 10% per annum with a payback period of 9-11 years.”

Offices in residential areas pay for themselves no faster than housing in the same areas

Head of the consulting and analytics department of the ABC of Housing company Artem Rzhavsky also confirmed that the payback period for investments in commercial real estate located in the central part of Moscow will be shorter than in residential real estate. However, I noted some exceptions. “This is not typical for residential areas on the outskirts of Moscow,” the specialist explained. “The payback period here is approximately the same.”

In the residential area of Mitino there is a commercial premises with an area of about 38 sq. m. m, located on the 1st floor of a residential building will cost about 9.5 million rubles, rent will bring about 492 thousand rubles. in year. At the same time, the cost of an apartment of similar size in the same area will be about 6.8 million rubles, and the rent will be 360 thousand rubles. in year. “Thus, the payback period for investments in a commercial space or apartment in a residential area of Moscow will be almost the same - about 19 years,” the specialist explained, noting that the NDV statement is only true for properties in the central districts of the capital.

Office leasing is a high-risk business, while housing is more stable. Therefore, the profitability of both is commensurate

Within the framework of the survey, a slightly different opinion was voiced. First Deputy General Director of Pioneer Group of Companies Alexander Pogodin believes that the profitability of residential premises and offices is comparable, since with higher rental rates for office premises, the payback period for housing is less dependent on the general economic situation. “Rental rates for offices are more susceptible to decline during periods of economic downturns and falling occupancy rates for office space,” the expert explained. “At the same time, the cost of housing rentals, if they decrease, is to a lesser extent, and the level of demand remains high even in crisis years; in addition, the apartment rental market is more understandable for private investors.”

Chairman of the Board of Directors of the RRG group of companies Denis Kolokolnikov also adds: “This is the risk of acquiring initially illiquid premises, and the risk of incorrectly determining the optimal purpose, and difficulties with paperwork,” the specialist explained. - In addition, the ongoing management of commercial real estate is much more complex, and the process of finding tenants takes longer. In addition, it is often not enough for new tenants to just make cosmetic repairs: for example, they have to make certain changes to the layout, which also increases the cost of maintaining the premises. For these reasons, many private investors hire management companies or begin to manage real estate on a professional basis themselves.”

Commercial tax expenses are higher

Elena Karpova, head of the marketing department of SEZAR Group, also recalled that one cannot ignore the fact that the costs of repairing residential and non-residential premises are not comparable. In the second case, they are an order of magnitude lower, which allows for significant savings. But at the same time, by renting out an apartment, owners have a real opportunity to evade taxes. “You can specify a smaller amount in the contract,” the expert explained. “But this trick won’t work with offices, and landlords will still have to pay income tax.”

Economy class is the most profitable housing option

Although, the first deputy director of the Miel-Arenda company, Maria Zhukova, especially drew attention to the fact that the higher the amount of funds invested in housing, the lower its rental yield will be.

“Despite the long payback period and low profitability, investments in residential real estate are considered the most reliable type of investment,” notes Maria Zhukova. - Renting housing in the capital will remain relevant in the future. In addition, economy class is the most popular segment in which tenants are looking for an apartment for rent. This suggests that there will always be a demand for such housing space, and the owner will always receive income from it when setting a rent that corresponds to the market.”

CONCLUSIONS

And here we come to the most important question: under such conditions, is it profitable for private investors to buy commercial housing with the aim of renting it out?

Yes, it’s profitable, but this requires much more money and market knowledge than buying most apartments. That is, in essence, these are different classes of investors - those who can afford to invest in commercial real estate, and even wisely, and those who have enough money for another home, but may not have any knowledge and experience in the market at all.

According to Vice President for Commercial Real Estate GVA Sawyer Elena Shevchuk, the minimum amount of possible investment in the purchase of non-residential premises in Moscow fluctuates around $1 million. There is also a chance of finding a premises for 300 - 500 thousand dollars, but this will require a lot of time and effort, as well as excellent knowledge of the market.

With such figures, it is not surprising that the main flow of private investors in Moscow is still considering investments in housing, since the minimum investment volume here is obviously lower than in the commercial segment. In principle, you can buy a decent apartment for 200-250 thousand dollars, and at an early stage of construction - even cheaper. Although the expert believes that the return on investment for apartments in certain areas may be higher than for commercial space, the cost of such housing will initially be higher.

Maria Lukina