In the last three years, the demand for commercial property for rent is tremendously increasing (specifically restaurants, retail spaces, and warehouses). Rental commercial property rates have gone up by 20 to 25% and prices have been increased by nearly 30%. Despite this, demand for these rental spaces has increased by nearly 20%, making them lucrative commercial property investment options.
If you are planning to invest in a commercial property such as restaurant, retail space or warehouse, factor in the following:
1. Restaurants. The number of restaurants in Pakistan has increased by an estimated 30 to 38% in the last two years. Custom-made spaces for restaurants are in high demand and their return on investment (ROI) ranges between 25 and 35% per year.
Areas where restaurant space is available include:
- Islamabad: Sector F-10.
- Karachi: Tipu Sultan Road and Block 4, Clifton.
- Lahore: M.M. Alam Road
Average sizes range between 400 – 1,200 sq feet.
Purchase Price Range: $ 300,000 to 450,000
Monthly Rental Range: $ 5 - $ 12.7 per square feet
2. Commercial Retail Space. These include commercial shops and commercial stores within malls and shopping centers. Their number has increased by 18 to 20% in the last two years and their ROI ranges between 22 and 25% per year. Retail commercial space does not require a lot of investment and is relatively easy to rent.
Areas where commercial retail space is available include:
Islamabad: Sector F-10. Giga Mall, Aquatic Mall, and Gulberg Greens.
Karachi: Clifton and Defence Housing Authority.
Lahore: Block Y, DHA, Gulberg and M.M. Alam Road
Average sizes range between 500 – 1,000 sq feet.
Purchase Price Range: $ 230,000 to 650,000
Monthly Rental Range: $ 2 - $ 15 per square feet
3. Commercial Warehouses. Due to increasing industrialization, the demand for warehouses has increased by 12 to 15% in the last two years. Initial investment and maintenance costs are lower compared to other commercial spaces; this makes them a popular choice for investors. Their ROI ranges between 15 and 20% per year.
Areas where commercial warehouse space is available include:
Islamabad: Sector I-9 and I-10.
Karachi: Hub and West Wharf
Lahore: Multan Road
Average sizes range between 500 – 3,000 sq yards.
Purchase Price Range: $ 1,500,000 to 3,650,000
Monthly Rental Range: $ 6 - $ 27 per square yard.
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