6 Categories of Real Estate

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There are several different types of real estate. Each one has its own benefits and challenges for the investor. Commercial properties have higher potential income than single-family homes. They also have lower vacancy risks and long-term leases, which can protect against inflation.

The six categories of real estate are residential, commercial, industrial, mixed-use, special use, and agricultural.


Real estate is any property that’s used for living, including homes, apartments, and townhouses. It also includes land that’s not zoned for residential use, such as vacant land or unused farmland.

A single-family home is the most common type of residential real estate. These are typically on their own lots of land, and homeowners can rent them out to generate income or live in them themselves.

Commercial real estate, on the other hand, includes land and buildings designed for business purposes rather than for living spaces. It also includes a variety of different types of businesses, such as restaurants and retail stores.


Commercial properties are real estate that is used for business and to generate income. They include office buildings, hospitals, shopping malls, retail stores, and industrial spaces.

The property may be leased out to a company or individual for five to ten years, making it a more lucrative investment than residential real estate. It is regulated by local governments, which set zoning for certain types of commercial buildings.

There are several benefits to investing in commercial real estate, including higher ROI and decreased tenant turnover. Additionally, commercial properties offer more opportunities for building relationships with tenants and other business owners.


Industrial real estate is the category of commercial property that encompasses factories, warehouses, and large buildings used for manufacturing, production, distribution, and storage. It’s an essential enabler of global commerce and an asset class that should not be overlooked by investors seeking reliable cash flow and resilient valuations.

One important feature of industrial buildings is their loading docks, which make it easy to load raw materials and end goods in and out of a building. In addition to allowing for the movement of products, loading docks also allow for storing goods.

Loading docks are essential for companies that need to move products in and out of an industrial building, as well as those that use tractor-trailers for distributing products. Parking is another key component of industrial properties, with 1.5 parking spaces per 1,000 square feet standard today.


A mixed-use property is a type of real estate that combines commercial and residential units. This category encompasses a variety of different property types, allowing investors to diversify their portfolios and increase their profits.

These properties are becoming increasingly popular due to changes in consumer behaviors and social standards. For example, many young adults prefer to live in areas where they can walk to their favorite shops and restaurants.

They also help conserve land and resources, as well as promote sustainability. Additionally, they reduce the need for cars, which helps decrease pollution. In addition, mixed-use developments are more pedestrian-friendly and less expensive to develop than traditional buildings.

Special Purpose

Special purpose real estate is an asset or property that has a specific use. This can be a building or piece of land that is used for business operations, like a restaurant, hotel, or golf course.

In this case, much of the value for your company is tied to that unique real estate. It can be hard to change that piece of real estate, especially if it was custom-built for the specific use that your business requires.

Consequently, eminent domain attorneys and expert witnesses must consider how to value these properties for condemnation. Sometimes, this means relying on a replacement cost analysis, which compares the special purpose property’s valuation to the costs of purchasing, preparing, and constructing another property that is similar. It may also require analyzing how depreciation will affect the value of the special-purpose property.