Industry insights, market outlook reports and commercial real estate
news, and trends from the Coldwell
Banker Commercial brand.
According to the 2019 Commercial Real Estate Outlook’s survey of 500 global investors, industrial, along with other “nontraditional REITs,” is the only asset not trading at a discount of its net value. That is despite growing global uncertainty due to U.S. tariffs and Britain’s exit from the Euro.
The past decade has seen several events and natural disasters, including an oil spill, multiple hurricanes, and a nation-wide recession. As a result, the commercial real estate landscape in the 5 coastal states along the Gulf of Mexico and the I-10 Corridor has emerged with more opportunity than ever before.
It has been said that it is only a matter of time before blockchain, the proprietary technology that supports cryptocurrencies such as Bitcoin, will begin to infiltrate industries worldwide. Believe it or not, even historically traditional industries are not immune to the disruption – commercial real estate included.
While senior housing has always been a profitable industry, it has really been able to stand on its own two feet recently as a viable and significant class of real estate – with more and more outside investors jumping on board and adding senior housing to their portfolios.
When unemployment rates increase as high as during the recession, folks rush to enroll in higher education. To improve their marketability and skills or access money while looking for work, universities saw an uptick in foreign and domestic student enrollment in U.S. universities during the economic collapse in 2010.
Ten years ago, the industry barely existed. Today, it is a multibillion industry in the U.S. Although the majority of the top financial technology or “FinTech” startups are small business and individual lenders, blockchain and cryptocurrency companies, and data analytics firms, several FinTech startups are impacting CRE.
Vacancy rates are at all-time lows. Absorption rates are at their highest. The “industrial sector has outperformed all other property types with double-digit total returns” according to the Integra Realty Resources 25th annual Viewpoint report covering the commercial real estate industry.
Investing in real estate can be a way to earn passive income and increase your wealth. While plenty of investors have success in residential real estate, others make a move to commercial real estate to gain even more money.
Last year, core assets were ranked second highest among investors. This year, secondary metros took that spot. Some argue that the cap rates for core assets and investors looking for assets that produce higher yields are why secondary markets look so much more attractive to investors this year.
In a recently released report from the National Association of Realtors (NAR), one fifth of agents that participated in the survey dealt with a commercial transaction where one side was internationally based. Of these transactions, the most international representation came out of China.