With 2019 coming to a close, we are looking ahead to 2020 commercial real estate trends. While no one can perfectly predict what the market will do – especially in an election year, there are a few things to keep an eye out for.
Various national and local trends can impact the commercial real estate market both positively or negatively. On a national level, we are seeing the lowest unemployment rate of 3.5% that the United States has seen in 50 years. Furthermore, the US economy has seen a slight increase in national average wages. This is all good news for businesses. While analysists predict growth to slow down a bit in 2020, they still expect a strong economy.
So what’s expected for the commercial real estate market?
Overall, multi-family properties are suspected to continue to perform well into 2020. Some predictions see a slight slow down as supply surpasses demand. In our local market of Wilmington, NC and the surrounding counties, we suspect multi-family properties to remain favorable as new jobs and companies come to our area.
According to CBRE, 2020 will see more developers turning traditional shopping malls into mixed-use complexes. This is something we are already seeing in Wilmington, NC as Independence Mall is currently undergoing renovations. While this trend may not look great for traditional retail locations, it goes to show the upcoming generations aren’t just shopping online and understand the importance of supporting local businesses. But, online shopping isn’t slowing down anytime soon!
As we enter 2020, vacant industrial space is limited due in part to manufacturing and the increase of e-commerce. This creates opportunities for both developers and investors. For one, large online retailers are continuing to set up distribution centers closer to consumer populations. Secondly, manufacturing and logistics are moving more towards technology-driven processes. Combined with the lack of industrial space available, this gives developers the opportunity to build properties that match tomorrow’s manufacturing and industrial needs.
For more on commercial real estate trends in 2020, read the detailed report on emerging trends.
If you’re looking for your next investment property, contact our team today.