The world is shrinking in a million ways, not the least of which is access to real estate investments. Cross-border investment is more common than ever before, as technology facilitates communication and investors look for global opportunities.
It’s the same all over the country: construction costs are through the roof. Since 2011, the national RSMeans Construction Cost Index has increased an average of 2.3% annually, totaling an 11.8% increase over that time.
When it comes to CRE investment analysis, stale data is worse than no data at all. Fortunately, there is a range of digital sources for accurate, up to the minute numbers on commercial property and transactions at all levels- from the local to the global.
Commercial real estate is enjoying a good run, with most sectors fully back in the saddle following the downturn of nearly a decade ago. A piece in Institutional Investor sums up the situation neatly:
“In terms of property fundamentals, apartments were the first sector to recover, reaching new peak occupancy and rents in 2011… whereas industrial properties got back to peak occupancy in 2014 and hit new peak rents last year. The situation is more mixed for office and retail sectors: Office vacancies are coming down but are still elevated above the past peak levels, and retail is still really hurting, with little improvement in occupancy and almost no gains in rents overall since the recession.”
The commercial landscape is ever changing, which is one of the things that keep it interesting. As new projects get underway, entire neighborhoods are energized and more new development is spawned.
Many times, all it takes to start a chain reaction is one bright idea that’s hatched at just the right time, when a neighborhood is ripe for rejuvenation. When that happens, investors are excited about being part of the change. The neighborhood becomes a hotspot for investment and further development. Here are some U.S. neighborhoods where change is afoot and opportunities are popping up like mushrooms after the rain.