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Budding Opportunities in the Commercial Real Estate Market

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Budding Opportunities in the Commercial Real Estate Market

Where are the opportunities in the commercial real estate market now?
With competition for residential properties at intense levels, and financing far more readily
available for commercial property investors than regular home buyers many are wondering
where the opportunities are for investing in the commercial real estate market now. Here are
four that stand out.
Marijuana Property
While some states may have relaxed marijuana laws more than others, these new rules are
creating more demand for real estate from coast to coast. There is a huge demand for growing
space, testing and packaging facilities, and retail dispensaries or pharmacies. As banks are still
too scared to hold marijuana money, many business owners in the industry are plowing their
profits into real estate assets. Florida is a top pick with its strong homestead protections.
Florida has also joined a number of other states allowing for the cultivation of marijuana. Those
include; Washington, Vermont, Oregon, Rhode Island, New Mexico, New Hampshire, Nevada,
Montana, Michigan and others. Florida Amendment 2 has made medical marijuana legal,
though it cannot be smoked. It is expected to be a $1.6B industry in the state within the next 22
months.
Shipping & Distribution Centers
The big race and competition in business today is who can deliver products to consumers the
fastest. That means a huge need for more local distribution and shipping hubs. The closer they
are to the consumer, the more options available. Everything is being used from lockers to
drones, to uber like delivery services.
Repositioning Retail
Massive shifts in retail over the last year have been very visible. Though rather than being the
death of physical retail, what we are seeing is that a major correction in store numbers and
footprints last year, are putting companies in a better position, while creating great opportunities
for investors to find better priced properties and redevelop them. The retail property of tomorrow
appears to be much more a live, work, play mixed use development with shops, offices, and
residences altogether.
Commercial Notes & Paper Assets
There’s more than one way to take down a prized property. One of the most underutilized
investment channels recently has been acquiring commercial loan notes. Non-performing loan
notes can be worked out with borrowers, with a stake taken in the business. Or they can be

foreclosed on as a shortcut to acquiring the property at a discount. It can then be redeveloped,
released, or sold on for a profit.
Summary
Commercial real estate is a hot sector this year. There are still both plenty of capital available to
finance new acquisitions and several areas of opportunity. Which strategy and type of deal will
you take on this year?

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