Real estate loan: can we invest in business real estate?

Corporate real estate is generally not the first reflex of individuals wishing to bet on a rental investment. And yet, it offers strong guarantees, good returns and many other assets that are often overlooked or underestimated. Not to mention a very favorable economic climate, which makes corporate real estate an investment that it is time to think seriously, in a context of low mortgage rates .

A flourishing French market

A flourishing French market

The latest figures of French corporate real estate revealed at the end of August by the newspaper La Tribune are particularly revealing: with an increase of more than 27% of transactions and 12.5 billion euros invested in the first half, the market is door extremely well. An insolent good health particularly strong in Ile-de-France (which harvests nearly three quarters of investments), driven by a wind of Brexit blowing from the United Kingdom and resulting in the installation of many companies in the Hexagon. A wind that does not blow everywhere in Europe, however, as Germany, Italy and Spain see company locations decrease by 10 to 50%! The French market is therefore today a real European locomotive in which one can invest in all serenity.

Attractive yields

Attractive yields

The average rate of return according to the IEIF currently stands at nearly 5% in business investment (offices and businesses). A rate that, compared with the current yield of Livret A (0.75% or less depending on some forecasts in the future), or the average return of traditional rental investment (3.75% according to INSEE) is extremely attractive. Especially since the commercial real estate requires less repair work, and reduces the periods of lack of rental (rate lower than 4.5% according to the latest statistics published in 2016 by the IEIF, either all the same 2 points less than the classic rental real estate).

An ideal economic context

An ideal economic context

High return and historically advantageous borrowing conditions, this is the current context that pushes many investors to engage in professional real estate. Indeed, thanks to a real estate rate that today reaches unparalleled thresholds (1.43% in August according to the Housing Credit Observatory / CSA), it has never been cheaper to borrow. Be careful however: the entry ticket is higher than in the retail market (we are talking about sums of 6 or even 7 digits), and needs to be structured in SCI or SNC , legal forms that do not oppose to the subscription of a mortgage.

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