The economy and industry impact the value and income potential of commercial real estate. As the economy slows, you may become concerned about the rental potential of your commercial properties. However, these are a few tips to help.
Look Toward the Industrial Sector
Although you may be concerned about economic slowing, the industrial sector is growing. The shift to online shopping from brick-and-mortar shopping has resulted in a decrease in the need for some retail spaces and an increased warehousing and distribution space. Each company that has an online presence needs a place to store inventory and ship out products. The demand is far greater than supply today, but this presents a great real estate development opportunity.
Find Ways to Serve the Community
Many individuals have realized the value of investing in their communities. You see, residents enjoy community spaces, such as event locations. Flexible buildings and locations can be used for a multitude of purposes, from weddings and parties to coworking and meeting spaces. Your buildings can also be used to host flea markets, farmer’s markets and retail space for local producers. Residents desire community spaces, making them great investments.
Adopt Cutting-Edge Technology
Your tenants will have a variety of technology needs. For example, multifamily properties may be upgraded with some smart home technology. You may also invest in smart metering to encourage energy efficiency. You may also provide high-speed and WiFi internet access.
Don’t forget to invest in your business as well. Using software that helps you manage your business, such as software that analyzes vacancy rates, rental fees and maintenance timelines, will increase your efficiency and protect your properties. Great management software will also handle customer service and relations, conduct marketing analysis and reduce your paperwork.
Create Co-Working Spaces
Over the last few years, and even the last decade or so, companies and individuals have recognized that not every employee needs to come into the office to do their work. In fact, more and more people are working from home. However, working from home can be challenging. It is easy to get distracted by kids, chores or more other projects. This has resulted in the growth of co-working spaces.
These spaces allow remote workers to have dedicated spaces to work. They are safe and free from distraction. They also allow workers to control their hours, network with other professionals, and motivate each other. However, there is no pressure from a highly competitive workplace because although you work near people, you may not be from the same company or doing the same tasks. Therefore, your tenants can socialize with others while still getting their work done.
As you consider your next commercial real estate investment, research industry trends. You may be surprised by the opportunities you find.