Commercial Investment
Commercial real estate investments are considered a strong investment for several key reasons:
Commercial real estate represents one of the most powerful vehicles for building and preserving long-term wealth — and it’s a natural evolution for investors who’ve built equity in residential or multifamily assets and are ready for their capital to work harder with less day-to-day involvement. At Thomson·Danforth, we guide clients across the full spectrum of commercial investment.
Why Commercial Real Estate?
Longer Leases, Less Management Commercial tenants typically sign leases of 3 to 10 years or more — sometimes much more — providing a level of income stability that residential rentals simply can’t match. Longer lease terms mean fewer turnovers, less hands-on management, and more predictable returns.
Higher Income Potential Commercial properties generally command higher returns than comparable residential investments. Cap rates are typically more favorable, and with the right asset and tenant, investors can achieve strong, consistent yields over the life of a lease.
Tenants Who Take Care of Business In many commercial lease structures, tenants are responsible for a portion — or all — of the property’s operating expenses, including taxes, insurance, and maintenance. This shifts the burden off the owner and simplifies what it means to be a landlord.
Built-In Rent Growth Commercial leases frequently include scheduled rent increases, either fixed or tied to CPI, providing a built-in hedge against inflation and steady income growth over time.
Strong Appreciation Fundamentals Well-located commercial assets in strong markets appreciate meaningfully over time, driven by demand for quality space, limited supply, and the underlying strength of the tenants and leases in place.
Portfolio Diversification Adding commercial real estate to an investment portfolio provides exposure to a tangible, income-producing asset class that behaves differently from stocks, bonds, or residential property — offering balance and resilience across market cycles.
Office
Office investment spans a wide range — from small professional suites and medical offices to multi-tenant suburban campuses. Despite well-documented shifts in how and where people work, well-located and well-tenanted office assets continue to perform, particularly in markets with strong employment bases and limited quality supply. We help investors evaluate office opportunities with a clear eye on tenancy, lease structure, and long-term demand in each specific submarket.
Retail
Retail real estate is one of the most diverse commercial asset classes, ranging from neighborhood strip centers and standalone pads to larger anchored centers. Location, traffic counts, tenant credit quality, and lease structure are the key drivers of value — and understanding how they interact is where our experience comes in.
Triple Net (NNN) Leased Retail — A Specialty of Ours
If there is one area within commercial investment that Thomson·Danforth has developed a particular depth of expertise, it’s NNN leased retail — and for good reason. A significant portion of our clients come to us having built meaningful equity in more management-intensive properties and looking for a better quality of life alongside their returns. NNN investments deliver exactly that.
In a triple net lease, the tenant — typically a corporate or franchise retailer — is responsible for property taxes, insurance, utilities, roof and structure, parking lot, and all repairs and maintenance. The landlord collects rent and has virtually nothing else to do. For investors who have spent years fielding maintenance calls and managing tenants, it’s a fundamentally different experience.
These leases are typically long-term — often 15 to 20 years — with annual rent increases and corporate guarantees behind them. The tenants are household names: national and regional brands with proven staying power, located in high-traffic retail corridors with strong demographics and growing populations.
One dynamic that makes these transactions particularly compelling for our clients: properties here in the Bay Area and Peninsula tend to trade at relatively low cap rates due to high demand and limited supply. That same capital, redeployed into a NNN asset elsewhere in the country, can achieve meaningfully higher returns — often dramatically increasing monthly cash flow in the process. We have completed NNN transactions in over half the states across the country, and we know how to identify the right tenant, the right location, and the right lease structure for each client’s goals.
For many of our clients, the path looks something like this: sell a locally-held, management-intensive property at a strong price, execute a 1031 tax-deferred exchange, and acquire a long-term NNN asset with a stable corporate tenant, built-in rent growth, and zero management responsibility. The result is more cash flow, less work, and a deferred tax bill. (More on 1031 exchanges)
Industrial
Industrial real estate has emerged as one of the most sought-after commercial asset classes in recent years, driven by the explosive growth of e-commerce, last-mile logistics, and domestic supply chain infrastructure. From flex spaces and R&D facilities — particularly relevant in our Bay Area and Peninsula markets — to warehouse and distribution assets, industrial properties offer attractive fundamentals: strong tenant demand, long lease terms, and relatively low management intensity. We help clients identify and evaluate industrial opportunities across our local markets and beyond.
Leasing
While investment sales are the core of what we do, Thomson·Danforth also assists clients with commercial leasing — whether you’re an owner looking to place the right tenant in your building or an occupier searching for the right space. We bring the same market knowledge and client-first approach to leasing assignments that we apply to every transaction we touch.