How to find mixed use commercial properties in any market

How to find mixed use commercial properties in any market

If you are in the market for mixed use real estate, you are certainly not alone.

The popularity of the asset class with CRE investors and businesses has increased dramatically in recent years due to its flexibility and appeal to a wide range of tenants and visitors. In this article, we're going to show you how to find mixed use commercial properties in any market. Read on to learn more.

What is a mixed use commercial property?

A mixed use commercial property is a single building or development that combines two or more property uses, most commonly ground floor retail or office space with residential units above. Because the commercial component generates business income, lenders and appraisers classify most mixed use assets as commercial real estate rather than residential, even when the majority of the square footage is apartments.

The distinction matters in practice. A mixed use property is underwritten on the income the whole building produces, financed with commercial loan terms, and traded in the commercial market. That is why mixed use assets appear on commercial listing platforms and in commercial property records rather than on residential portals.

What are the main types of mixed use commercial property?

Mixed use covers several distinct configurations, and the sub-type determines who the likely buyers and tenants are:

• Retail over residential. Storefront retail at street level with apartments or condominiums above. The most common configuration in dense urban corridors.

• Office over retail. Professional or medical offices on upper floors above ground floor retail, typical of suburban main streets and town centers.

• Live-work and industrial live-work. Units that combine a residence with workshop, studio or light industrial space in the same footprint.

• Hospitality-anchored. Hotel rooms combined with retail, restaurant or event space, often as part of a larger development.

• Mixed use developments. Multi-building projects that place residential, retail, office and sometimes civic uses on one master-planned site.

Zoning is what makes these configurations possible. A parcel has to be zoned for mixed use, or carry an overlay that permits it, before more than one use can operate legally on the site. Anyone evaluating a mixed use deal should confirm the current zoning designation and any conditional use permits before underwriting the income.

How to find mixed use commercial properties

There are two ways to find mixed use commercial properties. You can browse what is actively listed for sale on commercial marketplaces, or you can search the full inventory of properties, listed or not, using a property data platform. The second approach surfaces far more assets, because listed properties represent a small fraction of the total stock.

To find the ideal mixed use property for your needs, you can either search through the available listings offered for sale on various online marketplaces, or you can take a more analytical approach and research the entire off-market inventory through a platform such as Reonomy.

On-market vs. off-market mixed use properties

On-market mixed use properties are those actively advertised for sale. Off-market properties are everything else, which is the much larger pool. Reaching an off-market owner means identifying the property first, then working back to the ownership entity and the people behind it.

On-market properties are actively marketed for sale through various channels either by the owner or the agent hired to help with the sale of the asset. Off-market properties on the other hand, are all properties that are not actively listed for sale. They constitute a much larger pool of real estate. While this may surprise some, in today's transactional market a very large number of deals are conducted off market. But what's the reason behind the newfound popularity of off-market sales?

When conducting deals off market, you can avoid paying additional fees to middlemen and minimize the number of people involved in a transaction. Not to mention, you could potentially make an offer on any property in your market of choice. Platforms like Reonomy compile property and ownership information on both on and off-market properties across the nation, creating one of the most robust commercial real estate databases you can use to source new mixed property deals.

Find mixed use commercial properties for sale

Commercial listing platforms are the fastest way to see what is currently on the market. Coverage of mixed use assets varies between them, and not every platform offers a dedicated mixed use filter, so searching more than one is usually necessary.

Most people looking for a mixed use property will typically visit one of the more popular online marketplaces to begin their search and compare pricing of assets in the location of their interest. There are plenty of real estate listings platforms to choose from, however not all of them offer specific search filters for mixed use assets.

It is worth mentioning that both commercial and residential platforms may feature mixed use property listings. In most cases, using a combination of these services in your search will give you the most versatile results. Let's look at a couple of examples.

LoopNet

LoopNet does not have a stand-alone filter for "mixed use," however the Advanced Search menu allows you to search for a number of specific types of mixed use properties throughout the United States. For example, you can search for property sub-types such as:

• office / storefront retail

• office / residential

• storefront retail / residential

• industrial live / work, and more.

CREXi

Another popular commercial listings platform, CREXi actually features a mixed use property filter in its main search options. If you select "Mixed Use" as the property type you are looking for, you will see mixed use assets of any kind in your results.

If you would like to explore a more robust list of listing services in addition to LoopNet and CREXi, you can review our guide to commercial real estate platforms.

Find mixed use commercial properties in any market with Reonomy

Reonomy covers more than 54 million U.S. commercial properties, including roughly 270,000 mixed use assets. Searching by asset class, location, sales history and debt position lets you build a list of mixed use properties that fit your criteria whether or not they are listed, then move straight to the owner contact.

If you would like to search for properties both on and off-market and be able to get in touch with property owners directly, you can use Reonomy. By combining Reonomy's robust property search with analysis of the data you discover, you can find potential buyers and sellers of mixed use properties before they decide to take action.

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Searching for mixed use properties

Reonomy lets you filter mixed use properties by location, asset sub-class, building characteristics, sales history, debt position and tenant. Layering these filters narrows a national database down to a working list of target properties.

You no longer have to waste valuable time taking trips to your local county recorder or assessor's office to look for property ownership information. With Reonomy, you can now search for commercial property records nationwide quickly and efficiently, all in one place. There are several different ways you can approach the search process on the platform.

Search by geography

When starting your property search, you'll likely want to add a level of geographic filters. You can search specifically for properties in any state, city, county, zip code, and neighborhood. You can also search by street name or exact address.

Search by "mixed use" asset class and sub-classes

Next, you can filter your search only for properties of a specific classification. In the Asset Type tab of Reonomy's web app, you can select filters for a number of different mixed use sub-classes, or simply search for "All Mixed Use" properties.

Further physical qualifications that you can add to your search are located in the Building and Lot tab. Available filters include building and lot size, whether the property is in an Opportunity Zone, the year the building was constructed, and more.

Search by sales history and debt history

By adding sales and debt history filters, you can identify mixed use properties that are more likely to sell. Under the Sales tab, you'll find filters for "most recent sale date" and "most recent sale price."

Applying these filters allows you to search for properties that have or have not been sold in a certain time frame or within a certain price range. For example, by searching for assets that have not changed hands in the last 5 or 10 years, you can identify owners that are much more likely to be interested in selling their mixed use property.

Available mortgage and lender filters under the Debt tab include most recent mortgage amount, mortgage maturity date, mortgage origination date, and most recent lender. Mixed use real estate investors may also be interested in searching only for properties that are currently in pre-foreclosure. There are a few pre-foreclosure filters they can use including final judgement, Lis Pendens, and notice of default. Another available option here is the ability to search by date of auction.

Search by tenant name or tenant type

When looking at retail and office properties, knowing who the tenants are can be incredibly important. In the Tenant tab of Reonomy's web app, you can search for properties based on tenant name (for example "CVS") or tenant type. Tenant types can be searched by NAICS or SIC codes (for example Convenience Stores, Marketing Consulting Services, or Full-Service Restaurants).

Find mixed use property owner and tenant contact information

Ownership on mixed use assets is frequently held through an LLC or holding company. Reonomy resolves the owning entity and surfaces contact details for the individuals behind it, along with tenant decision-maker contacts, so outreach does not stop at a registered agent address.

Once you narrow down a list of target mixed use properties with the help of the filters we discussed this far, you can quickly begin exploring each asset in more detail, including accessing the owner and tenant names, and their contact information. You can find these details by clicking into a property's profile page and visiting the Ownership tab.

Here you will be able to see the reported owning entity, which could be an individual, investment group, or an LLC. Furthermore, you'll be able to see the contact information of the individual people associated with the property ownership, including those that are members of an owning LLC. If you move over to the Tenant tab, you'll see a list of all current property tenants, along with the contact information of decision-makers.

While you are viewing the ownership details, you can click the name of the owner to gain access to their full property portfolio. Ownership records can be very helpful in understanding the current owner's motivation and intent towards the property. With these invaluable insights in hand, you can build a hyper-targeted pitch and reach out to these mixed use commercial property owners with confidence.

Build a mixed use property owner list

A lead list built from property filters is pre-qualified by definition, because every owner on it holds an asset that already matches your criteria. Lists can be exported to Excel or CSV for use in a CRM or outreach sequence.

As we have illustrated so far, Reonomy allows you to create lead lists that are relevant and specific to you. One of the benefits of creating a lead list limited to your specific location and property characteristics requirements is not only the efficiency of having to reach out to fewer, pre-qualified owners, but also the ability to create personalized messages.

Additionally, based on the owner portfolio or specific mixed use asset, you may choose whether to directly call, email, or mail each decision maker on your lead list. It is also worth mentioning that if you've identified multiple prospect owners that you'd like to connect with, you can export your lead list to an Excel spreadsheet or a CSV file for flexible use.

Let's also look a bit more specifically at some of the granular benefits of searching for mixed use properties off market.

The benefits of sourcing a mixed use deal off market

Sourcing off market means fewer competing bidders, no broker commission on the buy side, and direct contact with an owner who has not yet decided to sell. It also widens the search from what is listed today to every mixed use property in the market.

One benefit of off-market deal making is that you are likely the first person to reach out to the property owner. If the owner has not listed the property, they are likely not actively looking to sell. This does not mean however that the owner wouldn't be open to the idea of a sale, after all, every asset has its price.

This doesn't necessarily imply that you'll overpay for the property, as you'll be saving on broker commissions and other servicing fees associated with using an agent. You very well may be able to offer the owner more than what they would make on the market, while still getting a favorable deal for yourself. When looking for off-market properties, you simply have more flexibility.

By using a tool like Reonomy, you have the ability to look at every property in the area of your interest, rather than just specific assets currently listed for sale. Additionally, you have the opportunity to contact mixed use property owners directly and cut down the time it takes to make a deal happen.

Frequently asked questions

What qualifies as a mixed-use property?

A property qualifies as mixed use when two or more distinct uses operate on the same site under zoning that permits them. The most common pairing is commercial space at ground level with residential units above, though office, hospitality and light industrial uses also count. A single-use building does not qualify simply because the owner works from home. The uses have to be separately established and permitted under the site's zoning designation.

What is an example of mixed-use property?

A four-story building with a coffee shop and a dry cleaner at street level and twelve apartments on the floors above is a typical example. Other common examples include a town center block with medical offices above retail units, a converted warehouse divided into artist live-work spaces, and a master-planned development that combines a hotel, restaurants and condominiums on a single site.

Is mixed use property considered commercial real estate?

In most cases, yes. Lenders and appraisers treat mixed use buildings as commercial assets because at least part of the property produces business income, and the building is valued on that income rather than on residential comparables. This holds even when apartments make up the majority of the square footage.

How do you find mixed use commercial properties for sale?

Start with commercial listing platforms such as LoopNet and CREXi to see what is actively marketed. CREXi has a dedicated mixed use filter, while LoopNet requires you to search specific sub-types such as office over residential or storefront retail over residential. To see properties that are not listed, use a property data platform to filter the full inventory by asset class and location.

Can you find off-market mixed use properties?

Yes. Off-market properties are not advertised, so they cannot be found by browsing listings. The approach is to identify buildings that match your criteria in a property database, review ownership tenure and debt position to gauge how likely the owner is to sell, then contact the owner directly.

How do you find out who owns a mixed use property?

Ownership is recorded at the county level, but mixed use assets are usually held in an LLC, which means public records often return an entity name rather than a person. A property data platform resolves the entity to the individuals behind it and provides their contact details, which is faster than working through county records manually.

Whether you are buying, leasing or prospecting, the mixed use properties worth pursuing are rarely the ones already on a listing site. Knowing what qualifies as mixed use and where to look for it is what separates a shortlist from a pipeline.