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Real estate has been around for several centuries as one of the asset classes. With the growing population and decreasing space, new investors seem to understand that real estate investment is a great way to stay on the top. Several real estate investors like Tom Krol have rags to riches stories that prove that real estate investment if done correctly can help you make your dreams come true. However, according to , many inexperienced real estate investors are unaware of the different types of real estate investments.

Since real estate investment if fraught with risks, it is advised to make sure you have a legal entity by your side. This involves using a legal structure in the form of a Limited Liability Company or better known as LLC. Your attorneys and accountants can help you set up an LLC or a Limited Partnership (LP) to make sure that all your deals are in order. If you are a part of more than one real estate investment group, it is advisable to use a different LLC or LP for each real estate investment. This asset separation will help protect your holdings in case you run into any financial or legal trouble later on. Real estate investments can be carried out in different forms, let’s take a look at some of the popular ones:

Residential Real Estate Investments
Properties like apartment buildings, houses, vacation houses, etc. come under residential real estate investment. Most of the leases are twelve months long and can be renewed if both the parties are satisfied. Some leases come pre-included with an increase in the rent every year; this depends on the local laws of the state or country.

Commercial Real Estate Investment
Properties like office buildings, skyscrapers, etc. come under commercial real estate investment. Since commercial real estate offers multi year leases, the owners have a more stable cash flow making it an attractive investment for real estate groups.

Industrial Real Estate Investment
This particular type of real estate investment is more varied as all kinds of real estate comes under this heading, like, warehouses, distribution centers, storage units, garages, car wash units, etc. These kinds of special purpose real estate generate sales from customers who are using the specific facilities. Although industrial real estate investment is considerable riskier than the other types of investment since the customer base is a bit narrower, it brings in more revenue in the long run.

Mixed-use Real Estate Investment
This type of investment consists of real estate properties that are a mix of many of the different types of real estates mentioned above. Some real estate properties have the ability to function as different entities. For example, consider a multi storied building, where each floor is rented out a bank, a gym, coffee shop, etc. This mixed-use real estate investment is quite popular as the diversification helps protects your investment group from any financial risks later on. Essentially, real estate investment is a great way to invest money; however, you need to do your research well before choosing a piece of property to invest in.