Q&A 20 August 2023

Torbit - August 20, 2023 - - 0 |

How can I reap the benefits of safe and high returns in Grade A commercial office real estate with low investment? ………..Prabhjot Singh, Chandigarh

You can break the high entry barrier in commercial office real estate by taking the fractional ownership route through fractional ownership (part ownership) model. Through fractional ownership, high-cost commercial office real estate is easily accessible to retail investors. With an investment as low as Rs 10 lakh, you can reap the benefit of high returns as part owner of the property. Moreover, one has the advantage of diversifying their investment portfolio.

Fractional ownership guarantees a high rate of return- both rental yield and capital appreciation. If you invest in a pre-leased Grade A office property of a reputed developer, you can expect an increase in rental returns in addition to capital appreciation. This rental increase is incorporated in the rental agreement to safeguard your investment from inflation-related risks. Moreover, commercial leases are of longer duration than residential leases and since Grade A office tenants include MNCs, banks, and IT companies, there is little or no likelihood of rental defaults.

The fractional ownership route ensures both safety and profitability of the investment. The returns can be anywhere between 8-10%. One can invest through fractional ownership platforms. These platforms duly share the lease/rental agreement, title report, sale deed, and SPV agreement with investors, constituting proof of property ownership.


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