A mixed-use property is a type of real estate property that includes commercial, residential and in some cases even industrial units for a property with multiple uses. This makes it possible for investors to benefit from different types of property in a single investment.
Mixed-use developments usually consist of complementary properties such as a hotel that also contains retail stores, offices, casino, restaurant, or a large fitness center on the lower levels. The upper levels tend to have residences or condos.
These developments are convenient for residents because they can lower or even compeltely get rid of the need to own a car making them very eco-friendly. And from an investment point of view, a multi-use property often generates better long-term performance and creates higher returns.
This space usually includes residential units located on the top floors and commercial usage on the ground floor. The main street model is one of the oldest and successful enduring examples of mixed-use real estate.
In a live/work building, tenants have no need to commute to work because it is set-up in the same building to live and work. An example is a commercial business on the ground floor of the building with residential apartments located on the upper floors.
Residential And Office
The residential and office building is a mix of office and residential units. This design is basically a commercial building with residential units in the same building usually on different floors. Investors will very likely experience higher returns and may notice higher-quality tenants who have a genuine interest to upkeep the property for walk-in clients.
The U.S. Small Business Administration (SBA) also provides mortgages for mixed-use commercial properties through affiliated lenders for business owners who plan to live in the building. This means that SBA loans are for owner-users, not real estate investors. An additional eligibility requirement is the business needs to use over 50% of the square footage.
In contrast to other mixed-use lenders, the SBA gives the investor an attractive down payments of only 10%. If the business is well established, 100% financing is may be obtainable.
In order to be eligible for a government-backed mixed-use loan, the main requirement is that at least 51% of the property must be occupied by the owner.