Commercial real estate has been booming for the past several years. In fact, 2018 was a great year for the commercial real estate business. During 2018, a number of interesting trends took off. Many of these are expected to continue through the end of 2019.
Retail Locations
One of the most surprising trends in 2018 was the resurgence of retail. In fact, many formerly online-only retailers started to set up in brick and mortar spaces. These companies came to realize that while e-commerce is a great way to increase efficiencies and limit costs, brick and mortar is how customers really get to know a brand. A physical presence also allows brands to capture customers they’d never come into contact with otherwise.
Real Estate Demand
Another trend expected to continue is the demand for US real estate. The US is not just a place where Americans buy land for homes and businesses. It’s a very attractive place to invest for people from China, where no land can be owned outright, and Russia, where the real estate market is plagued by dishonest buyers and sellers. For 2019, it’s expected that the demand for a foothold in the US will continue to be strong.
Suburbia is becoming hot again. Now that millennials are looking to start families, they are willing to consider the suburbs. Numbers bear this out. Another factor is the rising cost of city living. On the commercial side, even businesses are caving into this. Why lease expensive city offices when prices in the suburbs are much more affordable? This is, overall, good news for commercial real estate. Vacancy levels in cities are still low. An uptick in suburban areas is a net positive.
Technology
One of the strongest commercial real estate trends for 2018 was the rise of technology. Tech has been on the rise for decades of course, but the real estate business has been resistant. In 2018, that all turned around. For 2019, this seems likely to continue, especially since big players like JLL are becoming big investors in real estate tech. Known as PropTech, innovations are making it easier than ever before to do business in the commercial space. The expectation is that brokerages of all sizes will be adopting new tech throughout 2019.