Do you consider yourself a savvy commercial real estate investor? Are you looking to improve your portfolio with strategic investments? Or are you simply trying to be the best real estate investor you can be? No matter where you’re at and where you’re headed, below are 6 of 2019’s top commercial real estate trends for investors.
- 1. The Growth of Build-To-Rent Properties
- 2. Choosing to Rent, Not Buy
- 3. Creative Ideas for Satisfying Demand
- 4. Big Tech Expanding Outside of Traditional Hubs
- 5. Joint Ventures Between New Partners
- 6. Industrial Trends
- 7. Investing In Single-Family Rental Homes
- Take Advantage of Investment Opportunities in 2019
1. The Growth of Build-To-Rent Properties
Across the nation, America is experiencing a new migration. Due to rising costs in cities like San Francisco, Los Angeles, and Seattle, some people are moving to more affordable parts of the nation. Along with this new migration comes the need for more housing. As these people relocate to secondary and tertiary markets like Atlanta, Dallas, and Charlotte, the build-to-rent industry is also expanding.
In fact, in some traditional homebuilders and real estate investors have focused on the build-to-rent sector.
2. Choosing to Rent, Not Buy
What’s more, not everyone has the traditional American dream of owning their own home. In fact, millennials generally choose to rent rather than buy homes or condos. Part of this is their tendency to work and live in central business districts, like Houston’s CBD. This lifestyle choice to rent rather than buy has driven down vacancy rates. At the same time, this decision is also driving the demand for build-to-rent properties.
3. Creative Ideas for Satisfying Demand
As the demand for rental properties rises, the stock of available housing declines. In some areas, new construction isn’t possible. Consequently, the real estate industry will need to get creative in 2019 to address the housing demand in some cities. One increasing trend in residential development is multigenerational housing. In the coming months, real estate investors seeking the best investments may find that traditional housing units may give way to more creative, nontraditional housing options.
4. Big Tech Expanding Outside of Traditional Hubs
Silicon Valley is no longer the nations’ tech mecca.
For the past few years, rising costs for employers and employees has forced some big tech firms to expand outside of Silicon Valley and the Bay Area. In fact, Silicon Valley is no longer the nations’ tech mecca. Certain cities like Dallas/ Ft. Worth, Atlanta, Austin, and Provo could experience significant growth as big tech continues expanding beyond Silicon Valley.
As is often the case, this type growth is usually good news for every commercial real estate sector, from retail to office to healthcare properties. Moreover, the expansion of big tech could create diverse investment opportunities for investors across the nation.
5. Joint Ventures Between New Partners
2019 holds many opportunities for joint ventures. Specifically, expect partnerships between REITs (real estate investment trusts) and other large capital partners. These partnerships offer new ways for capital investments. On top of that, these join ventures present new avenues for returns on investments.
6. Industrial Trends
For certain businesses who are looking to grow in 2019, they might experience a lack of industrial space. So expect new industrial construction to fill this gap. At the same time, the construction of new warehouse and industrial spaces will shift towards areas that will attract employees. Coupled with that, expect to see future industrial and warehouse spaces set in master-planned communities with amenities like daycare, shopping, and restaurants.
7. Investing In Single-Family Rental Homes
Not only are multi-family rentals becoming a wise investment choice, single-family rentals have become an excellent place to park your investment dollars. Due to uncertainty and unpredictability in financial markets, single-family rentals are a safer bet. This is mainly because retail real estate investment has little connection with stock market activity. Because of this, single-family rental properties offer investors advantages such as favorable leverage and higher returns.
Take Advantage of Investment Opportunities in 2019
2019 holds great promise for real estate investors. Be aware of these top commercial real estate trends for investors could help solidify your investments. So to begin investing or to expand your existing portfolio, contact CXRE today. Our professional team of experience brokers can advise you on the top real estate investment opportunities in Houston, Dallas/Ft. Worth, and beyond.