Examining the State of Commercial Real Estate in 2022 With James C Dragon

Investors seeking to diversify their portfolios often look to real estate as a vehicle for accumulating wealth. Given the uncertainties associated with the economy, global pandemics, and other major world events, it’s worth considering the types of properties available and their locations. Commercial real estate expert James C Dragon believes that the outlook for commercial properties is overall positive, but a closer examination of the types of real estate is important for would-be investors.

Shopping and Retail

Shopping centers, particularly open-air centers in residential areas with high populations continue to perform well. Typical retailers at these commercial properties include supermarkets, fast-casual restaurants, and in-person services such as salons. These services continue to be in high demand, especially as people return to pre-pandemic routines. James C Dragon thinks you should be on the lookout for non-traditional retail categories such as medical testing clinics and healthcare providers. 

On the flip side, Class B and C malls are not bouncing back to pre-pandemic conditions. These sites may be good choices for different types of reuse, especially given their proximity to parking and other residential areas. Developers may consider these sites for alternative housing and other types of retail.  Properties like these also lend themselves to industrial applications such as warehouses, distribution, and fulfillment centers.

Multifamily Housing

Rising costs and mortgage rates for single-family housing mean more people are signing longer leases for apartments and multifamily units. Rents are at an all-time high and the demand for high-quality rental homes makes investment a good prospect, especially in places experiencing population growth. There’s major potential for public and private partnerships when it comes to creating affordable housing for workers in high-demand industries such as healthcare and tech. 

Industrial Facilities

E-commerce continues to be a booming business and major online retailers need industrial sites that help fulfill orders. Emerging industries in the online retail space such as life sciences also power the continued demand for industrial spaces. One development that James C Dragon has his eye on is the creation of single facilities that fulfill several business purposes. Imagine a distribution center that also has showrooms or shopping areas for customer transactions. The corporation may find value in adding other types of facilities to boost productivity and efficiency such as fitness facilities, food serveries, childcare areas, and other spaces typically found in offices. 

Office Spaces

The push for remote and hybrid working models has forced many companies to rethink their office spaces. Labor shortages are leading some to add amenities to attract and retain qualified workers. Trends in office space investment will be dependent on location and industry. Not all locations or industries are created equal. James C Dragon suggests taking a closer look at the types of businesses where employees are returning to work and checking for trends and patterns before investing.