As the year comes to a close, it is time to take a look at the opportunities of the coming year. In terms of the commercial real estate market, it looks like the tri state area is heading towards another healthy year.
What Factors Contribute to the Health of the Market?
Technological advancements play a large role in the state of the real estate market. Buyers have a need for better data access.
Other influential factors are dependent upon the people in the community. Things to watch for include tenant dynamics and shifts in customer demographics. This will guide what types of properties are developed.
Like any market, there can be ups and downs. In the past year retail and office properties have experienced the most negative impact, but overall there is a steady trend leaning towards success. Across core property types commercial real estate fundamentals remain strong. There is positive rent growth and stable vacancy rates. Cost is the most competitive factor.
Property values, though they have improved, are still recovering from the recession in 2009. The slow recovery should not prevent improvements, however. Overall the commercial real estate market in the tri state area should be steady in 2018.
Which Types of Commercial Real Estate have the Best Markets in the Tri State Area?
In New Jersey, industrial construction has a strong market. The towns that are doing best all have easy access to trains. In other words, development is strongest near the NJ Turnpike. Market strength is also influenced by New Jersey’s location. Since it is between two major cities, Philadelphia and New York, the state has a competitive edge when it comes to e-commerce distribution and warehousing.
Office properties are recovering in New York City and the past year has brought the construction of many new developments in Manhattan. Technological growth has improved this market.
The Philadelphia Business Journal claims that the real estate market is thriving. Buildings are being bought prior to construction completion. Philadelphia has a stronger market than much of Pennsylvania.
Summary of the 5 Best Commercial Real Estate Markets in the Tri State Area
- Industrial Real Estate- The growing popularity of e-commerce has strengthened the market for data centers and warehouses. This is particularly true in areas of New Jersey with easy access to public transportation.
- Multi-Family Properties- Apartment living is popular particularly in urban areas, though there is a growing call in suburban areas. These properties often have multiple functions including having retail space on the bottom floor.
- Hotel Realty- As wages rise, there is an increased demand for lodging. Continued growth is expected through 2018.
- Office Real Estate- Market growth should continue into 2018, though at slower rates than the past year.
- Retail Properties- Trends show that discount retail has a growing popularity. This will continue to shift how competition is approached.