Office building vs. multi-family rental - Better for retirement?

[cinfooya]

Want to retire from traditional 9-5 job. Luckily saved a nice nest-egg but not enough to live off of for next 25 years until real retirement. Instead thinking of real estate / rental. Don't want to deal with sketchy renters, so leaning toward buying office space. Thoughts?

[bjl584]

I'd lean toward the multi-family. I'd rather depend on multiple tenants than just one.

[rennigade]

Real estate section is that way...https://www.savingadvice.com/forums/...ate-investing/

[disneysteve]

I'd lean toward the multi-family. I'd rather depend on multiple tenants than just one.

An office building doesn't necessarily mean just one renter. It could be a multi-user building.

[Fishindude77]

I'd much rather have a commercial rental than a residential. Lock in a long term triple net lease where tenant takes care of just about everything. I've been renting a commercial building to same tenant for 17 years. Much less hassle than dealing with individual renters.

[97guns]

I see a lot of vacant retail space in my area, some offices too. I think your pool of tenants is much bigger for residential space than retail, I could be wrong but that is what my gut tells me. Also when you go to sell I know for fact it is much harder to sell a retail space, I have an uncle trying to sell a 3 building retail property and he's not getting any inquiries, if it was a house he would be getting some hits, it takes a very specialized buyer to buy it.

[disneysteve]

I see a lot of vacant retail space in my area, some offices too. I think your pool of tenants is much bigger for residential space than retail, I could be wrong but that is what my gut tells me.

I think that's very much a local issue based on the local economy and existing retail space. I'm not sure you can generalize about it.

Also when you go to sell I know for fact it is much harder to sell a retail space

That's a good point. I'm sure the pool of people looking to buy your house is much larger than the pool of people looking to buy a retail building.

[~bs]

anecdotal, but vacant office space in my area tends to stay vacant for quite a while before finding a tenant, that may or may not go out of business within a few years, and repeat the process again. so unless you have a large portfolio of office space, and can afford to keep a % vacant, it can be risky.

on the other hand, residential space in my area is in a shortage, and prices are being driven up by demand. I mean you know it's bad when you have tiny studios renting for $1300-1500

[Fishindude77]

A good commercial property is easy to keep rented. I've always done 10 year leases, so who cares if it sits vacant a couple months between tenants, the first tenant pretty much paid it off.

[97guns]

A good commercial property is easy to keep rented. I've always done 10 year leases, so who cares if it sits vacant a couple months between tenants, the first tenant pretty much paid it off.

Not doubting it, I've seen both my uncles do very well with commercial property although one of them was in the RV/campground business. He actually had no problem dumping off 2 properties, I'm pretty sure they were sold under market value to move quickly, he bought them dirt cheap 30 or 40 years ago so that was factored into his asking prices, the other uncle should do the same to get the ball rolling.

[TexasHusker]

Another variation in this theme is storage buildings. A know of a fellow here who has done very well with this. He has an onsite manager that receives free housing and a small monthly salary.

[PeggyHefferon]

Location Location Location

You have to understand YOUR local market to determine what is the best option. The better TYPE of renter is irrelevant if you can't find one.

[TexasHusker]

I think that's very much a local issue based on the local economy and existing retail space. I'm not sure you can generalize about it.


That's a good point. I'm sure the pool of people looking to buy your house is much larger than the pool of people looking to buy a retail building.

For every 100 people looking to buy real estate, maybe five of the bunch is looking to purchase as an investment. Most are looking for a roof over their head.

[Kaoru]

For every 100 people looking to buy real estate, maybe five of the bunch is looking to purchase as an investment. Most are looking for a roof over their head.

And sadly many still have no roof over their head, while more people are buying investment real estate.

[commoncentsmike]

Another variation in this theme is storage buildings. A know of a fellow here who has done very well with this. He has an onsite manager that receives free housing and a small monthly salary.

I remember wanting to get into this a few years back. Less than 6 months later one goes up right down the road. Just goes to show you ideas are a dime a dozen and it's all about execution.