Commercial properties are considered high risk mainly due to the following reasons:
Sensitivity to economic conditions: Strong economic conditions usually result in an increase in commercial property demands. However, an economic downturn usually results low demands. You may have to time your purchase or sale.
Tenancy not guaranteed: Although leases are usually long term, tenancy isn't guaranteed. It may take a long time to find a tenant and you'll need to cover all property expenses during this time. If you want a guaranteed rental return, you can invest in a Defence Housing Australia (DHA) property.
Values can drop suddenly: The value of a commercial property can drop sharply if it becomes vacant or its lease is about to expire.
Impact from changes in infrastructure: Changes in infrastructure of nearby areas can lure away potential tenants. This is more likely if your commercial property is older.
However, please note that there are ways to increase your commercial property value cheaply to attract tenants or potential buyers.