The logic behind mixed-use properties

With so much knowledge in the real estate business, Eugene Bernshtam has a lot to share about what goes on behind the scenes. In this blog post, he tries to explain the logic behind mixed-use properties.

In simple terms, a mixed-use property is a property that is made up of a good mix of residential and commercial tenants. You might have seen a compound or a building whose fringes are occupied by businesses that cater to the general market in a particular area, while on the inside, you will see people enjoying the comforts of home.

If you are a prospecting property owner who wishes to have a property that generates steady income, owning a mixed-use property is definitely something you should consider. It makes sense to have businesses in your building, which can enjoy tenants' loyalty that is already living in that very structure.

Residential tenants will always have needs, and they would benefit from the products and services offered by your commercial tenants. For instance, if one of your commercial tenants owns a salon, you can expect that your residential occupants will avail of the salon's services for their own needs.

This is good news for the salon because, with a guarantee of foot traffic and steady clientele, they will earn what they need to cover their overhead expenses, including rent. If your commercial tenant's business is good, business is good for you as well.

You must also note that you won't benefit much by enlisting commercial tenants whose businesses will only compete with each other. It will not make sense to enlist two salons, but if you have a salon and a barbershop as tenants, that could be a better combination to your benefit.

Eugene Bernshtam heads Avalon Holdings LLC and its affiliates, which specialize in apartment buildings and mixed-use properties. For more about his industry, visit this page.