Commercial property is real estate property that is designed for use in specific types of business situations. Unlike industrial property, which would include manufacturing plants, commercial property encompasses such business properties as office space, shopping centers, hotels, and service stations. The key indicator of a commercial property is that it is involved with the moneymaking efforts of a business, but does not engage in the actual production of goods.

Real estate zoning laws may vary slightly when it comes to commercial property from on jurisdiction to another. However, these real estate laws tend to draw a clear line between residential, industrial, and commercial property. This can sometimes be confusing for some people, as some types of living space qualify as commercial property. For example, a residential home would not be considered commercial property in most cases, even if the home were rented out as part of a business venture. At the same time, an apartment building with multiple units of living space would be considered a proper commercial property.

Research facilities are also often understood to be commercial property. This would include laboratories, and hospitals with lab functions housed within the structure. In like manner, facilities that provide basic services to clients would also meet the general definition of commercial property, such as doctors’ offices.

As is true of all zoned property, commercial property is subject to a specific taxation structure within the local jurisdiction. In many cases, towns may offer incentives that help to attract businesses to establish a commercial property within the city limits, in exchange for a break on property taxes for a specific period of time. This type of incentive is often extended when the business is anticipated to provide significant benefit to the community.

In some jurisdictions, the distinction between commercial property and industrial property is somewhat hard to identify. This is especially true if the property includes both manufacturing and retail space within the structure. In some areas, companies that wish to house more than one function within the same building must obtain an exception from the local jurisdiction in order to allow production and retail functions to co-exist.