As the real estate market continues to rebound from several very dark years during the Great Recession, it has become increasingly clear that real estate development in both the commercial and residential markets has once again become very strong. As a result of this, there have been several recent trends in real estate development that are shaping the market not only now, but will do so in the years ahead. To gain a better understanding of just how these current results have impacted the United States as well as international real estate markets, examine these growing trends.
Neglected for far too long, more and more towns and cities across the U.S. have started revitalizing their downtowns. For example, according to the National Association of Realtors, as cities have looked for cheaper ways to revitalize their downtowns, many have turned to real estate. Taking unoccupied buildings and converting them into office space as well as apartments has thus become a trend that appears to have no end in sight, since it allows towns and cities to revitalize themselves while still keeping the character they’ve had over the years.
Viewed today as something that can lead to significant change within towns and cities, this development trend involves real estate developers changing how they use space, time, and money to create not only places for people to live and work, but also create areas of buildings designated for e-tailers to open brick-and-mortar stores. While overcoming the fear factor involved with changing technology, this trend has allowed developers to invest in industries that are up-and-coming, not ones that are considered sluggish in today’s economy.
Multifamily Properties Stay Popular
For the first time in a decade, transactions involving multifamily properties have outpaced office transactions. What this means for developers is a growing demand for apartments and other multifamily dwellings in some of the country’s biggest real estate markets, including Chicago, New York, Washington, D.C., and Los Angeles. The focus of these dwellings will be not only on young professionals who prefer to live close to their jobs, but also seniors who have come to embrace the idea of city living that offers mass transit options as well as homes that are within walking distance of shopping and cultural opportunities.
Investors Follow the Jobs
As cities such as Austin, Seattle, Portland, and Houston all experience significant job growth in such industries as energy and banking, real estate investors are following the people and the jobs to these cities. As a result, the Pacific Coast is prepared for a boom in office development as well as residential offerings, which will allow states such as Oregon and Washington to reap the benefits of both job growth and real estate development simultaneously.
As these and other trends continue to develop and evolve, there’s little doubt that the real estate market will reap the benefits. With these and other changes rapidly shaping how people live, work, and play, investor and consumer confidence will continue to rise.
Roman Temkin is a real estate developer from New York City.