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1. Benefit of USA Commercial
Property

2. Benefit of USA Commercial property
 A lot has been written about housing property
investments but the areas of commercial
property investments are not very common with
most of US. A huge number of investors are
more at relieve with investing in housing
property as they are common and comfortable
with it.

3. What is Commercial property?
 Commercial property is office spaces, trade
units, and industrial factory sites, warehouse
and developed industrial sheds. The investment
process and income are quite different to the
traditional residential.

4. September 30, 2008
Why Invest in Real Estate?
Investment Total Returns
5.3%
-22.0%
7.9%
13.3%
0.2%
5.6%
14.2%
5.2% 4.3%
11.8%
3.1%
5.4%
-30%
-20%
-10%
0%
10%
20%
1 Year 3 Year 5 Year 10 Year
NCREIF - NPI S&P 500 Lehman Govt. Bond Index
Past performance is absolutely no
guarantee of future performance,
especially in the short-term and
maybe not in the long-term

5. Top 200 Pension Fund Allocations
* 2008 is estimated based on a 20% decline in total assets and constant real estate dollars allocated
Real Estate Allocation to Total Assets
Source: Pensions and Investments, UBS Research, Cornerstone Research
Uh-oh!
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08*
$
trillions
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
5.5%
Total assets (L)
Real estate allocation (R)

6. 0
25
50
75
2001 2002 2003 2004 2005 2006 2007 2008
Billions
of
US$
Apartments Industrial Office Retail
Monthly Sales Volume by Property Type
Commercial Real Estate Sales Activity
Source: Real Capital Analytics, Cornerstone Research 8-28-2008
Portfolio deals, REIT buyouts fueled peak activity in
2007, transactions fall to 5-year low in 2008

7. Cap Rates Disconnect
Commercial Real Estate Valuation
Source: NCREIF, Cornerstone Research 8-28-2008
Transaction vs Current Value Cap Rates
4%
5%
6%
7%
8%
9%
10%
11%
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08
Year
Cap
Rates
Cap Rates - All Sold Props
Current Value (Appraisal) Cap Rates

8. Why Commercial property is Better Than
the Housing Property?

9. Income & Risks:
The risks low and also the
incomes are also low in the
housing property; however the
commercial property has a
higher profits with a higher risk.
In USA the commercial market
vary from location to location,
but if one takes an overall
analysis of profitable returns
compared to inhabited returns,
the difference is strikingly poles
apart.

10. Rents Period:
Inhabitant leases tend to be for six or twelve months, which is a
smaller period. Though, a great USA commercial property is
rents out for a higher period of time may be about six to seven
years with a boom of rentals ranging from 15 to 25% yearly.

11. Quality of Occupant:
The occupant is obviously a vital and critical part of your
property. In best commercial USA property, a large business
tenant occupier is considered a blue chip tenant. They are
probable to rent your property for a long period of time and are
doubtful to default on the rent.

12. Investment Ratio:
Retail commercial property in USA is frequently much more expensive
than buying inhabited property.

13. Profit of a Commercial Property
Investment:
One of the chief advantages of being an landlord of perfect USA
commercial property is that once you have a possible blue chip
business as a renter you have the benefit to flip your property with
a larger outskirts, where you would find ready purchaser offering
you the rich best, your pockets swell more and more, still though
you have been milking the buffalo for over so many years. This is
not the case in inhabitant investments.

14. Real Estate Portfolio Management
Thanks
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