Pricewaterhouse-Coopers is now in its 37th year of publishing it’s Emerging Trends in Real Estate, one of the oldest, most highly regarded annual industry outlook for the real estate and land use industry.
It includes interviews and survey responses from hundreds of leading real estate experts, including investors, developers, property company representatives, lenders, brokers and consultants.
This is a fantastic resource for investors to commercial real estate, and owners preparing for the coming new year.
There is also a fantastic interactive map to guide your investing search by city, state, and market.
This years 2016 report offers a glimpse into our changing markets and the exciting possibilities ahead for us in 2016:
1. 18-hour cities 2.0: Potential workers are drawn to these markets due to the availability of services and amenities similar to larger metro areas, but at an affordable cost. Employers are drawn to the quality of the workforce and the lower cost of doing business.
2. Next Stop: The suburbs…What is a suburb?: A growing amount of evidence supports the idea that millennials will eventually make their way to outer neighborhoods and even select suburban locations. While they are leaving the urban center, they are still looking for walkable locations with good public transportation and all of the amenities to which they have become accustomed.
3. Offices: Barometer of change: Technology is allowing workers to be much more flexible in what they can do and where they can do it. In addition, we are seeing workers who prefer to go from project to project rather than commit to a single employer and firms who prefer to share space with other companies. In the middle of all this change, we are witnessing the beginning of the exit of the baby boomers from the workforce, leaving generation X in charge of the growing millennial workforce.
4. A housing option for everyone: Single family rental continues to develop as a preference for a number of households, who like the lower cost of entry and flexibility. Going forward, the housing market will see demand from aging baby boomers who will be looking for homes where they can age in place. While younger millennials will look for affordable options in higher cost urban areas.
5. Parking for change: Mass transit, bicycles, ride sharing, and walking are becoming more popular ways to get to and from work. Another issue is how to provide parking to tenants who have a large number of workers with alternative work arrangements, but who may be in the office at the same time. Building owners will need to find alternative ways to generate revenue from resources currently devoted to parking.
6. Infrastructure: Network it! Brand it!: With the number of infrastructure needs in markets across the country becoming more numerous and varied the opportunity exists for private investment to become more involved in providing solutions. These solutions are good for the community, and if designed appropriately can be profitable for investors.
7. Food is getting bigger and closer: What is the solution when you have a generation that clearly expresses a desire to eat fresh more nutritious foods but chooses to live in large urban areas?
8. Consolidation breeds specialization: The market has realized that there is still room for those who specialize. This specialization reminds us that real estate is still a hands on investment that benefits from local expertise. Specialization allows developers, owners, service providers, and operators to provide that expertise to a growing variety of real estate investments.
9. We raised the capital, now what do we do with it?: The big six markets that have been the number one choice of many investors have seen prices reach a level where investors are now seriously considering expanding to a wider market set and alternative investment choices.
10. Return of the human touch: Technology, big data, and increased market transparency has led to the perception that real estate investing can be done using an algorithm.