Property Classified As Commercial Real Estate
Commercial real estate is any non-residential property used solely for business purposes. If the real estate makes money, is rented out, used for investments, or falls into a number of other categories other than being a private residence, it can be considered commercial real estate. It covers retail properties, office buildings, shopping centers, hotels, warehouses, manufacturing facilities, apartment complexes, and vacant land that has the potential for development. In short, commercial real estate is a very broad category covering almost any kind of real estate except the single-family home and single-family lots. Even a single family home can be labeled commercial real estate if you buy the home for the purpose of renting it out and generating an income, or if you own the home and convert it into an income-generating property.
Different Rules for Commercial Real Estate
Different rules may apply to commercial real estate verses residential realty. For example, qualifying for a commercial mortgage may be different from qualifying for a personal mortgage, In many cases, your ability to get a personal mortgage is based solely on your income, while your ability to get a commercial mortgage may be based on the income that is generated or expected to be generated from the property. There may also be different tax rules for your commercial realty and such property may be treated differently in the event of bankruptcy.
To better understand whether a given property will be classified as commercial real estate, and for more details about what rights or requirements may be associated with your commercial real estate holdings, consult an experienced lawyer for guidance.