One of the reasons for this, is that people tend to be intimidated by commercial real estate, assuming it’s going to be more difficult. The realty is although it’s very different, that doesn’t make it more difficult. Commercial real estate can provide a long term cash flow with an investment comparable to a residential rehab, but with far less competition.
For the same reasons listed above, less competition equals less offers on commercial properties, so sellers tend to be a lot more open to creative financing ideas.
Commercial tenants tend to pay more, require less management, and treat the property better than residential tenants. Commercial real estate also has a higher price per square foot than it’s residential counterpart.