As we enter into the second half of 2019, it’s time to examine the commercial real estate trends we have seen and will continue to see in 2019. Many of these trends are national but have an impact on investors and business owners here in southeastern North Carolina. Here are a few of the commercial real estate trends we are seeing and expect to continue.
Industrial Real Estate will Grow
Thanks to major retailers like Amazon and the growth of e-commerce, the industrial commercial real estate market continues to grow. From manufacturing buildings to warehouses to distribution centers, e-commerce is a driving force in today’s commercial real estate market. This is happening in locations beyond what is considered the major industrial areas. As companies and investors look for secondary spaces, smaller industrial areas are seeing the benefits.
Millennials are Heading to Suburbs
As the Millennial generation approaches their early 30s, research shows they are leaving the city for the suburbs. But they aren’t leaving that lifestyle behind. In fact, they are bringing certain aspects of the city-life to suburbia. Major suburban areas are becoming more walkable and have seen an increase in amenities. For real estate investors and business owners, this creates a fresh opportunity in the burbs from restaurants to multifamily and mixed-use development.
Multifamily And Retail Space Will Continue to Grow
In the upcoming years, we suspect to see multifamily and mixed-use spaces continue to be popular development options for investors. In southeastern North Carolina, we’re already seeing this trend with properties like Harrington Square in Leland, NC. From millennials desiring city-like amenities in the suburbs and boomers looking to downsize and simplify, these work-live-play communities are appealing to the masses.
Costs for Tenant Improvements Will Likely Increase
In 2018, we saw an increase in building material and labor costs, and this is predicted to have an impact in 2019 as well. As you plan for tenant improvements, be aware of your budget and potential cost overruns. If the upgrades will increase revenue, it is likely a good idea to move forward. If not, consider waiting until prices level out.
Opportunity Zones will Continue to be Popular
During the beginning half of 2019, “Opportunity Zones” was the biggest buzzword in the commercial real estate industry. While some of the buzz may have slowed down, these properties will continue to be a great opportunity for real estate investors. Opportunity Zones were established to help revitalize communities that are considered economically distressed by using private investments rather than taxpayer dollars. Here in southeastern North Carolina investors have the opportunity to benefit from this new tax incentive.
The commercial real estate market in North Carolina provides investors and business owners with a wide variety of options and opportunities. With over 30 years of experience, we would be happy to talk to you about your options for buying, selling, leasing, or managing commercial property.