Each week we bring you the best of what we’re reading in industry news & market trend commentary.
How Retail Real Estate Continues to Change
Forbes – Ever-changing consumer shopping behaviors continue to influence the retail sector. Typical retail-only spaces have begun to diversify their tenants to attract a broad range of consumers. Traditional CRE assets like office and multifamily are increasingly components of large mixed-use projects that aim to create live-work-play environments in many gentrifying areas across the country. As consumer trends and tenant lease requirements continue to transform, landlords, developers, and investors will have to adapt by incorporating more dynamic spaces into their projects.
NREI – According to research from the CoStar Group, the smallest 25% of one-bedrooms in the U.S. have lower vacancy rates than larger one-bedrooms. Economic factors contributing to the demand for smaller apartment units include: housing affordability challenges, increased student debt, and job creation in highly populated metro areas. These factors are putting pressure on renters to sacrifice living space for lower rental rates. This trend will continue to impact the multifamily space with an increase in new construction of micro-apartment units. There is an opportunity for density-minded developers and sponsors who can create new inventory at scale, especially within urban infill submarkets across the country.
Bisnow – Online grocery shopping and food kit deliveries continue to drive demand for cold storage facilities. Today’s consumers are more conscious of their food choices, demanding online grocers supply organic food and fresher ingredients. Companies that are investing in quality food inventory are in need of cold storage facilities to store perishable items and meet expedited shipping timelines. As such, new construction of stand-alone cold storage warehouse facilities is expected to increase in the coming years, making them a top-of-mind asset type for real estate investors.