Trends In Commercial Real Estate

When it comes to Commercial real estate there are many variables to determine trends in commercial real estate, but here are a few outlooks that some financers are saying will definitely be a fad this year and the next. Some of these you may agree with, some you may not, but this is supposed to be the outlook for the next few years, especially this year and the next, so it might be worth doing some more research to find out more.

Increases To Capital Flow and Allocations

One thing you can expect in 2016 and 2017 is the increase of investment capital coming into commercial real estate. The amount of capital available would be troublesome if it weren’t for the simple fact that there is some of the BEST risk/reward when it comes to real estate. Especially when it comes to things like bond values and multi-year run ups. Make sure that you look out for options that offer higher allocation options and more foreign investor monies that push up and beyond 2007 peaks - these are things you should be aware of and that should because you concern.

Low Supplies

Another trend happening right now and it looks like it will continue through 2017, are low supplies. New Supplies are at an all-time low right now - historically speaking, and the reason behind this is the fact that the market rents have not been able to justify new

construction on buildings so therefore financing has continued to stay at a steady level. But that’s great and a benefit because it leaves a massive amount of potential property sections to push onto occupancy and rents.

Increased Risk

Today more investors are willing to accept additional risk for additional ROI. This is leading to an increase in secondary markets such as Charlotte and Austin where Class A properties are now coming into play - this was never really the case in the past few years. Beyond just those secondary Class A properties, the risk and reward have also led to other riskier markets such as Class B and C properties. Investors are also starting to follow jobs as well as people. The markets mentioned above, have shown a lot of

benefits and job growth dynamics. Locations such as San Francisco, Austin, and Seattle are also picking up more when it comes to technology, banking, and energy. Risk is always and will always be a factor when it comes to any kind of investing, but the simple fact that more and more people are willing to risk a little in order to possibly make a lot in return, just shows that the economy is on an incline and things are getting much better than they were even 5 years ago.

Plus, maybe people are beginning to see that investing isn't something you can exactly pussy foot around, sometimes you have to take big risks to in turn get big rewards in the real estate game.

Multi Family Options

The trend in multi family construction started around 10 years ago and it is yet to cease. In fact, not only are multifamily houses becoming more popular, but the demand for apartments is also been in demand as well. These rates have really increased in markets such as Chicago, New York and LA especially in the urban areas of these locations because more and more people from the "echo" boomer generation (Millennials are sometimes also called Echo Boomers, referring to the generation's size relative to the Baby Boomer generation and due to the significant increase in birth rates during the 1980s and into the 1990s. In the United States, birth rates peaked in August 1990 and a 20th-century trend toward smaller families in developed countries continued.)) want to

find locations where they can own a home or rent a place and still have walkable surroundings around them as well as mass transit like trains, busses, and subways available to them. Other locations where you can find spaces like this include places like Pittsburgh PA, New Jersey and even some parts of Florida.