Mixed-use developments are the future of urban living. They offer a variety of housing options and retail outlets in one place, which saves people time from having to go all over town just to buy groceries or take care of errands.
If you are considering a real estate investment, knowing the specifics of mixed-use development can be a step toward financial success.
Defining Mixed-Use Development Investments
Mixed-use development is simply the combination of two or more uses for one piece of property. Mixed uses may include apartments, condos, offices, and retail stores.
The best news about mixed-use properties is that they create value in several ways. For example, consider a condo building that houses both residents and retail storefronts on the first floor.
A management company rents out the 20 condo units to residents looking for quality homes in the city. However, there are commercial spaces on the first floor that house an appliance store and accounting services.
These businesses attract customers who buy tools and supplies for their home maintenance needs or have tax preparation work done by professionals. As long as people live in the condo building, there is a healthy demand for these services.
The Benefits of Investing in Mixed-Use Developments
One of the great things about mixed-use development investments is that they often increase in value. In the example above, condo units continue to increase as more people want to live downtown due to increased convenience and amenities. There will always be demand for someone looking to rent or buy a home within the area.
A second benefit of investing in a mixed-use development is that it minimizes risk. Mixed-use developments also have an advantage when it comes to financing options. There may be limited competition for a loan because most banks would rather finance a mortgage, retail, or office complex. As long as there is an active demand for the service, the company can pay back their loan and everything runs smoothly.
With this knowledge in mind, an investor can take a piece of mixed-use property and enjoy an increase in value and long-term financial returns.