Tag Archive For "Commercial Real Estate Trends"

Commercial Real Estate Delinquency Rates Climb – Watch Out In 2017

Commercial real estate trends point to prices falling by as much as 5% in the next 12 months.

What gives?

A storm is brewing, creating a tsunami of issues for the commercial sector. The global surge in U.S. property investments that drove record values in years passed is expected to wane alongside lower oil prices and disjointed debt markets. Property sales by publicly traded landlords, debt maturities, and tightened regulations are furthering the trend. The instability is creating a volatile commercial real estate selling atmosphere, with uncertainty about U.S. policies following the presidential election worsening matters.

Let it rain

Commercial mortgage-backed securities (CMBS) float amidst a tumultuous market in which borrowing costs for landlords are higher, inhibiting future price growth. Properties in small cities, dependent on Wall Street banks for funding, have been hit especially hard – a global market rout in February sent prices plummeting after Wall Street dealers were unable to provide liquidity when hedge funds were forced to sell CMBS holdings. Regulations such as Dodd-Frank are also not helping the situation, making it increasingly expensive for banks to hold securities.

Cold front

The market has shown signs of cooling since the start of the year, with commercial property values in big cities declining 3% in just the past 3 months. New York, the biggest market, is forecasted to decline as much as 30% over the year. Even REITs (real estate investment trusts) are being affected, with shares trading at prices that undervalue holdings (shopping malls, office buildings, hotels, etc.), leading them to become net sellers.

Bailing out

Despite the expected downturn in commercial real estate trends, the sun could break through the clouds, presenting new opportunities in the form of bargain prices for investors, and opening opportunities for investors to bail out borrowers who’ve come up short.
Are you prepared to weather upcoming commercial real estate trends? Properties Online is here to help. Contact us today.

2016 Real Estate Trends: The Move Towards Online Real Estate

Has 2016 Delivered on the Projected Commercial Real Estate Trends?

Trends are emerging that will disrupt “business as usual” in the commercial real estate market. Dropped your crystal ball? No worries – we’ll fill you in…

Time’s they are a changin’ – redefining this market segment and plotting a new course:

• More general development
In this sixth year of recovery, office, industrial, hotel and residential development are expected to grow as the economy shapes-up, interest rates increase, and access to financing widens.

• Retail stalls, warehouses boom
As e-commerce continues to change the landscape with faster delivery options and the rise of online shopping/in-store pickups.

• Autonomous vehicles and car sharing
Could transform real estate markets – and parking situations. This includes drones and driverless vehicle technology.

• Flexibility is key
The process of identifying space to meet consumer needs (variable schedules, shifting calendars, shared space) will be accelerated due to high demand. Real estate owners should be looking to form partnerships with these shared providers.

• Multi-tasking environments will be in huge demand
Places where people can work/live/play 24/7 – on-site and without the 30+ minute commute. And this re-urbanization is underway globally.

• Rising capital investments
As institutional investors strive to take advantage of these changes and boost portfolios. Mergers/acquisitions will rise, and REITs could go private through buyouts.

• Customer migration to online real estate shopping, sales, and more
Tenants/customers looking for better, faster service will rely on the Internet for more data access (i.e.: who has the space they’re looking for at the best price), as well as the streamlining of property operations (hint: controlling heating and air conditioning systems/costs are only the beginning). Real estate owners must start investigating ways these evolving technologies can improve interactions with tenants and customers now if they want to ensure future success.

Don’t get stuck in the past, look into the future of commercial real estate. Take advantage of the next generation of real estate sales technology. Grow with the changing world with Properties Online today.

Commercial Real Estate Industry Lags in Embracing New Technology

A report compiled by Altus Group, a Canadian information technology (IT) firm, recently found the trillions of dollars invested in the global commercial real estate market are being processed with grossly outdated technology at risk for human error and inaccuracy. Though real estate trends have shown an increase in new commercial real estate capital, it has apparently NOT been funneled into upgrades.

Error 404 Commercial IT Doesn’t Exist
Dollars have been invested instead in other tech, such as smart building technology, automation systems, and improved energy efficiency. All the while the roughly $11 trillion in commercial real estate investments worldwide are handled manually via spreadsheets.

Warning: Parental Controls Have Blocked this Site
This inherently manual system introduces not only the element of human error, but lack of visibility through data silos – stifled, lost, or overlooked information resulting from a poor data management system that makes real-time data comparison for professionals nigh impossible.

Improper Bandwidth
Compared to the healthcare and finance industries, commercial real estate investment in IT is falling woefully behind the times. How far? The industry is struggling to efficiently absorb it’s huge interest – upwards of $500 billion this year alone in new capital.

WARNING: Your IT Has Not Been Updated in 3,650 Days
Though the appetite for IT investment exists, committing to it over asset acquisitions and networking will be the challenge. In Canada, home of the study, a push is being made to synchronize data across a single platform countrywide so brokers can share information, thus combatting inefficiencies in the system which are currently preventing access to tangible, essential information central to commercial real estate services. Its completion date, however, is unknown.

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