what is commercial real estate cre 
commercial real estate cre is property used exclusively for business related purposes or to provide a workspace rather than a living space which would instead constitute residential real estate most often commercial real estate is leased to tenants to conduct income generating activities this broad category of real estate can include everything from a single storefront to a huge shopping center commercial real estate comes in a variety of forms it can be anything from an office building to a residential duplex or even a restaurant coffee shop or warehouse individuals companies and corporate interests can make money from commercial real estate by leasing it out or holding it and reselling it commercial real estate includes several categories such as retailers of all kinds office space hotels and resorts strip malls restaurants and healthcare facilities understanding commercial real estate cre commercial real estate and residential real estate comprise the two primary categories of real estate property residential properties include structures reserved for human habitation and not for commercial or industrial use as its name implies commercial real estate is used in commerce and multiunit rental properties that serve as residences for tenants are classified as commercial activity for the landlord commercial real estate is typically categorized into four classes depending on function individual categories may also be further classified there are for instance a number of different types of retail real estate similarly office space has several subtypes it is often characterized as class a class b or class c note that some zoning and licensing authorities further break out industrial properties sites used for the manufacture and production of goods especially heavy goods but most consider it a subset of commercial real estate commercial leasessome businesses own the buildings that they occupy however the more typical case is that the commercial property is leased usually an investor or a group of investors owns the building and collects rent from each business that operates there commercial lease rates the price to occupy a space over a stated period are customarily quoted in annual rental dollars per square foot conversely residential real estate rates quote as an annual sum or a monthly rent commercial leases will typically run from one year to 10 years or more with office and retail space typically averaging five to 10 year leases this can be contrasted with more short term yearly or month to month residential leases there are four primary types of commercial property leases each requiring different levels of responsibility from the landlord and the tenant managing commercial real estateowning and maintaining leased commercial real estate requires full and ongoing management by the owner property owners may wish to employ a commercial real estate management firm to help them find manage and retain tenants oversee leases and financing options and coordinate property upkeep and marketability the specialized knowledge of a commercial real estate management company is helpful as the rules and regulations governing such property vary by state county municipality industry and size the landlord must often strike a balance between maximizing rents and minimizing vacancies and tenant turnover turnover can be costly for cre owners because space must be adapted to meet the specific needs of different tenants for example if a restaurant is moving into a property once occupied by a yoga studio 