The potential of Vacant Land as well as Commercial Real Estate (CRE) properties as an investment opportunity is quite under estimated and is one of the most overlooked and misunderstood real estate investments.

A recent report by David Funk, director of the Baker Program in Real Estate at Cornell University and a NAIOP Distinguished Fellow (NAIOP  is the leading real estate organization for developers, owners and related professionals), shows that real estate has now become a permanent fourth major asset class after stocks, bonds and cash.

David Greene, a Forbes columnist, mentions in a recent article that real estate builds wealth more consistently than other asset classes.

Reasons That Make Vacant Land & CRE An Attractive Investment Option

1) Great Returns:  Vacant Land and CRE both deliver high returns. Investment in Vacant Land appreciates steadily as value is added to it by taking it through the approvals & permit process and making it construction-ready. On the other hand CRE, with smart value-add and high quality tenants is not only a steady cash-cow but also generates significant capital gains.

2) Diversification and Reduction of Risk:  While other asset classes like stocks, bonds and money markets have strong relationships and can decline concurrently, Vacant Land and CRE values both largely operate independently. That makes it a great way to reduce risk and diversify a portfolio. Both investors and advisors can agree that investing in Vacant Land and cash-flow products like Commercial Real Estate (CRE) can be an excellent hedge against a wildly fluctuating stock market and that diversification is a key element of reducing portfolio risk and optimizing returns. 
The purpose of having all four asset classes represented in your portfolio is not only to prevent investment downfalls but also to take advantage of the different strengths of each class. The whole theory of asset allocation is based on diversifying your portfolio by asset class; you never want to find yourself in a situation where your portfolio is reliant on one asset class to carry the weight.

3) Inflation Hedge: Vacant Land and CRE both respond well to inflation. As the value of other assets decline during inflationary periods, real estate values remain steady. 

4) Comparison With Other Asset Types: Stocks give you a chance for higher returns, but they also come with far more risk; Bonds don’t offer substantial gains, but they’re one of the safer investment options. It’s on you to find out which combination of assets makes the most sense for you.