The Difference Between Commercial and Residential Real Estate

Just as thousands of individuals seek to find their ideal home space, there are thousands of business owners seeking to find the ideal place to set up shop. These business owners include the local restaurant owners, to growing manufacturing companies, to retail chains, and second-hand stores.

For all of these business owners, they face the confusing world of commercial real estate. Many of the common agencies, including Re/Max and Prudential, have commercial divisions – but many of the top commercial brokers are little-known brands. Commercial Real Estate Brokers have real estate agents who are comfortable with their ability to find the right space for the business’ needs and who is capable of drawing up the correct financial information for the transactions.

Commercial Real Estate Expertise

Most of the real estate agents that work in the commercial realm, find they specialize in a specific type of property.  Buying and selling million dollar properties in the commercial field usually takes a high degree of specialization.  For instance, a commercial real estate agent may specialize in:

  • Commercial Vacant Land
  • Retail
  • Industrial
  • Office Space
  • Restaurant

Same License

Both residential and commercial real estate agents have the same license from their respective state.  There is no difference in the official licensing process.  Many commercial real estate practitioners may take additional courses, specializing in commercial real estate.  Although there are many, CCIM is the largest and most respected designation that is obtained in the commercial industry.

In residential the same things apply.  The residential agent may have a CRS or GRI designation from the National Association of REALTORS. The individuals who work in the business and commercial real estate section of the real estate agencies all have undergone extensive education regarding the zoning and legal facets of business and commercial real estate. These individuals have dedicated their careers to finding the right space for each business that comes seeking their assistance.

Is Commercial or Residential Better?


Commission Based

Just like the typical real estate sales person, the commercial real estate agent often is paid based off of commission.  There may be compensated through the real estate agency that helps to balance out the income when there are no sales to be had, but in general, it is all commission based rates. Just like the typical real estate agent, the commercial real estate agent must be registered and licensed within the state that they work for, although the commercial real estate agent may also be required to register and be licensed in the city or county that they work in as well.


Just as the typical real estate agent knows about the taxes in the area of a house, the commercial real estate agent knows about taxes in the area of the business. This can often include tax breaks and benefits for moving to the location. These tax breaks and benefits help to draw in more work and therefore help to pay itself off by allowing people to have more spending money and a better standard of living.

The typical commercial real estate agent has a large portfolio listing all of the different business types and business locations that are up for rent or sale. This often includes locations that can be divided up or remodeled to suit. These are also big attractants to new businesses and can help to drive the sale.