Commercial Real Estate Holds Strong

Commercial Real Estate holds strong! We are experiencing a very busy time practicing commercial real estate thanks to an increase on activity of Tenants and Investors. Moving forward to the next quinquennium we should look at the coming market trends, I do not have a crystal ball to anticipate the future but I strongy believe we should pay attention to important indicators as:

Sources for Investment

The availability of funds to be invested in Commercial Real Estate are increasing year after year with expectation to be above 40% by the end of 2019. As confidence returns to real estate, the industry faces a number of fundamental shifts that will shape its future. The good folks at PricewaterhouseCoopers (PwC) have looked into the likely changes in the real estate landscape over the coming years and identified the key trends which, they believe, will have profound implications for real estate investment and development.

Global megatrends will change the real estate landscape considerably in the next six years and beyond. While many of the trends highlighted are already evident, there’s a natural tendency to underestimate how much the real estate world might change by 2020. Cities are growing around the world, people are moving from rural to urban locations. By 2050, 75 percent of the population will live in cities.

Sustainability, Water Suplly & Food Supply 

 We will need to pripovide 50 percent more energy, 40 percent more water and 35 percent more food.

We have a resource scarcity problem on this planet, which will change the countries we trade with. Landlords have started taking sustainability into account, transforming properties and constructing new buildings to LEED certification. Building owners are much more sensitive to recycling programs, alternative energy sources, waterless toilets, improved lighting and low volatile organic compound (VOC) carpet and paint. Using sustainable elements in real estate is almost a given now.”

Growth in Technology Technology is changing real estate, from e-commerce forcing bricks-and-mortar retailers to re-evaluate their models to a change in the way we use office space.

Capital Availability

Rise in Investable Real Estate and Capital By the end of this decade, the amount of investable real estate is expected to increase by 55 percent. Sovereign wealth funds are expected to be the largest contributor to real estate investment, as they are currently on track to invest $13 trillion in real estate by 2020, Carlock from PwC said. “If you look at the increase of available real estate for investment along with the acceptability of real estate as a viable investment, you’ll see there will be years of continued vibrant activity, both internationally and domestically,” he added. The entire interview about "Real Estate 2020: Building the Future," as well as the PwC report itself, is available at the show website CREshow.com.