If you’re getting involved in the commercial real estate industry, it’s vital that you stay on top of the latest trends and developments each year. Investors need to know how to make the most of their investments, after all. Whether you’re a beginner commercial real estate investor or you’ve been in the industry for years, here are some trends to keep an eye out for in 2022.
The Federal Reserve kept benchmark interest rates near zero in September 2021, and that trend is likely to continue into the coming months. The effects of this have trickled down to some of the lowest interest rates the United States has seen in decades, making it more affordable to invest in real estate now than before. These low interest rates also mean you can take on an investment loan—though investment loan interest rates are usually high, the lowered interest rates now can make the investment loa potentially cost less.
Retail has, unfortunately, suffered greatly due to the pandemic, and because of that there will be many continuous changes in both client behavior and use. It’s uncertain whether we’ll ever return to pre-pandemic standards, but it’s good to keep up with the changes we will likely see until then. For example, the United States saw a massive increase in e-commerce sales and will likely continue to do so. With this added pressure on retailers, wholesalers, and third-party logistics companies, companies needed to search for new ways to reach out to their consumers. Retail-to-industrial conversion projects are likely to accelerate as a result.
Stockrooms will also become a top priority for many. Business owners must organize their stock rooms so they can fulfill orders coming in through both in-person and digital channels. Local pickups have also increased in popularity, so many stores will need to have a space for safe transactions if they don’t have one already.
Though urban housing is still popular and necessary, suburban living in duplex apartments and beyond has taken over the real estate market. People are searching for small towns rather than big cities to live in, and many are willing to commute to the city so they can pay less in the suburbs. This will give buyers potential space for a home office so they can have a good work-life balance.
Though there are plenty of more trends to keep in mind for the upcoming year, having these at the forefront of your mind can be beneficial for your investing success.