Many assume that the commercial real estate market is dipping amid work from home orders and the challenges of hiring and maintaining staff or closing altogether. However, 2021 was a strong year for commercial property and 2022 looks to build on that success.
Reasons to be optimistic
There are few guarantees in life, especially when it involves real estate. But Forbes magazine cited some developments that prompt their experts to be optimistic:
- The market went up: The commercial real estate market rebounded in 2021 with a 64% increase in volume over 2020 and a 12% increase over 2019 levels. The prices are rising at a double-digit percentage rate, led by apartment and industrial space sales.
- New and expanding digital companies: The rise of remote work and e-commerce led to a boom in the digital industry, which still needs brick and mortar locations for its hardware, data centers, communications towers, and the rest.
- The economy: Inflation will likely remain high early and then ease. Supply chain bottlenecks will also loosen. Long-term interest rates are predicted to stay low, which provides attractive financing conditions.
- The return of brick and mortar: Many have found a lot to like and dislike about online shopping, but in-store sales have now surpassed pre-pandemic levels. More demand means more retail stores.
- Back to work: Companies will keep some of the changes and flexibility brought on by the pandemic, but not everyone can work from home, nor do they want to.
- The virus recedes: There will continue to be flareups and setbacks like the recent Omicron, but these surges will likely less common and less impactful as time goes on.
A wise investment
Commercial real estate continues to be a wise investment here in Texas, but it is still smart to be careful when buying and selling. Investors, owners and buyers all can use legal guidance in navigating the terrain of post-pandemic real estate. Their knowledge can help avoid costly mistakes and unfavorable conditions that could be detrimental to those involved.