Commercial real estate is often shifted or reshaped by things such as globalization, workforce trends, technology, and the retail industry. In 2020 it appears that most commercial real estate professionals are optimistic.
Here are a few of the biggest commercial real estate trends of 2020.
People want to be engaged when they spend money. In recent months the American Dream mall at the Meadowlands in New Jersey opened. This mall is a gleaming example of the rise of experiential retail. In fact, only 45 percent of the mall is actually retail space. The majority of the space is entertainment, restaurants, and other related uses. People can go indoor skydiving and then grab a bite to eat on their way to the movies. This trend is already popular across the country as old shopping centers become mixed-use spaces where people can live, work, and play. It seems that places such as the American Dream mall are more than a trend and that experiential retail is here to stay. This provides commercial real estate developers and investors with a ton of opportunity to convert old retail spaces into places that will thrive again.
Demand for Industrial Space
Industrial properties were highly sought after by investors last year and that is a trend that will continue through 2020. Consumers demand the same or next day delivery which is a huge factor in the surge of distribution and warehouse facilities being developed. As more and more people are completing their shopping online there is a need for more warehouse space and old malls make the perfect conversion projects. The trend of malls becoming distribution centers will continue to grow as retailers continue to compete with e-commerce organizations such as Walmart and Amazon. To match the demand spec building is increasing, however, the spec spaces are being leased quickly, often before the building is even completed.
Election Year Creates Inaction
It is very common for business owners to slow their decision making duing election years. Small to mid-sized building and business owners often wait to see who will be in the White House which creates a possibility for greater opportunities. Since a portion of the competition is sitting out of transactions and waiting to see what happens there could be interesting chances for those that don’t.