A pre-leased property is a property that already has a tenant and an active lease at the time of purchase.
The buyer starts receiving rent after ownership is transferred, subject to the lease terms.
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A strong tenant generally has:
The exact legal entity signing the lease should also be verified.
The lock-in period is the minimum period during which the tenant or landlord cannot terminate the lease without financial consequences, except under specified conditions.
Rental escalation is the increase in rent after a fixed period.
For example, the lease may provide for a percentage increase every three years.
Office space is used for business operations and employee workspaces.
Retail space is used for selling goods or services directly to customers.
Warehouse space is used for storage, logistics, distribution or industrial operations.
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Commercial property may offer higher rental yield and longer leases.
However, it can also have a higher investment amount, longer vacancy periods and greater dependence on business demand.
Gross yield is calculated before expenses.
Net yield is calculated after deducting maintenance, taxes, vacancy, repairs, brokerage and other ownership costs.
