Understanding Commercial Real Estate Trends
Whether you are looking to buy or sell commercial real estate, you’ll want to make sure that you find the right professionals that can help you with this endeavor. Furthermore, if you are also trying to sell your business along with the real estate, know that there are companies out there that specialize in selling both the business and real estate sides of the equation.
2023 Outlook on Commercial Real Estate: By the Numbers
It is important to note that not all commercial real estate throughout the country operates exactly the same way. For example, the rise of office vacancies in the San Francisco area went up from 15% vacancy in 2022 from 6% vacancy in pre-pandemic times. New York contains a surprising number – over 2 million commercial real estate properties alone.
What are the Main Types of Commercial Real Estate?
Let’s have a look at the major classifications of commercial real estate. First off, retail real estate is quite common in the form of general purpose shopping centers. Next up is multi family which typically comes in a variety of apartments based formats. Special purpose commercial real estate includes such property types such as stadiums, amusement parks, and self-storage. Still others include mixed use which is simply a combination of multiple types of commercial real estate – such as retail mixed in with multi family. Office spaces are common commercial real estate properties, ranging from Class A (new and luxury) to Class D (needs significant improvement).
Industrial commercial properties come in 3 main categories: bulk warehouse, light assembly, and flex warehouse. Hotel and hospitality also makes up a significant portion of overall commercial real estate properties. Lastly, there are a number of sub-categories of land as commercial real estate: agricultural land, infill (vacant land near commercial properties), and brownfield (impaired or contaminated lands).
Where is Commercial Real Estate Still Successful?
While a number of types of commercial real estate sectors are declining in today’s market environment, still others are thriving. Data Centers, for instance, are shown to hold up quite well – even in a down economy. Self-storage also continues to be a bright spot in an otherwise uncertain market and time in the world.
Another consideration is to not just buy commercial real estate properties but entire businesses looking to sell that also include commercial real estate along with the overall purchase. This could ensure a healthy investment return for years to come.
Bringing it All Together
Keep yourself informed and make sure you understand the latest commercial real estate trends. Remote work and retail versus eCommerce has changed the overall portfolio of commercial properties and their uses over time. Learn more about these commercial real estate trends in the infographic below, courtesy of Chess Realtors:
Source: ChessRealtors.com
