Commercial property is great until it isn't.

For the positives, you typically Longer lease terms, most Commercial leases often last 5–10 years, providing stability for both tenants and landlords. And if the business is doing well they are almost guaranteed to renew. Now this is subjective to where you are, but general rule of thumb is that you get higher rental yields than residential properties. Again, depends on the exact terms of the lease, but a fully repairing lease is standard for commercial property which is a huge pro over residential. The commercial tenants cover maintenance and insurance, reducing costs as well as workload. Businesses also tend to be just that, business. Business tenants often maintain more professional, business-like interactions and upkeep, I have found you do not get the emotion that often goes into to residential lettings and the argo that can cause.

This all sounds great and it is, until it goes wrong. With commercial property you run a far higher vacancy risk. vacancies can last longer, especially in economic downturns. Not just months but possibly even years, which after a period you will also be hit with the cost of paying the business rats to the council, which can be significant. They are also far more subjective to economic sensitivity. Commercial spaces are more vulnerable to market cycles, interest rates and business closures. Approximately 20% of small businesses fail within their first year, more than 50% fail within the first five years, and 70% fail within ten years which is also reflected in commercial property market. Further, whilst there are benefits to commercial leases over residential, they as also far more complex. Whilst any idiot can understand a basic residential AST, negotiating and understanding commercial leases can be more complicated and solicitors (and their costs) are usually required for initial signing and renewals. And again this is subjective to the negotiation and individual leases, but the upfront costs of taking on a new commercial tenant can be high. Fit-outs and compliance (e.g., ADA standards) can be expensive for tenants, and so it is not uncommon for landlords to either contribute or have a free rent/reduced rent period of say 3 months from signing to help the tenant get up and running.

I have commercial property in our portfolio and I love it until it goes wrong and then its a massive headache.