Demographic Trends Shaping CRE

Demographic Trends Shaping Commercial Real Estate
Commercial real estate must respond to the needs of Millennials who are starting families and building careers while Baby Boomers retire and age. Properties are needed to meet both generations’ vastly different desires and lifestyles.

Saddled with debt, Millennials are much slower to buy homes than previous generations. They are more likely to rent, requiring an increase in multifamily units. They want walkable, livable neighborhoods. Baby Boomers will be looking to downsize, and some will relocate to warmer climates for retirement living.

Technology use clearly shows the generational divides. This impacts how they use commercial spaces. Online shopping has replaced visits to big-box stores and malls. Some of these retail sites are being transformed into mixed-use areas that include entertainment attractions and restaurants; some properties are experimenting with including residential spaces. Expect the repurposing of retail space to continue.

But while the rise in online shopping has emptied malls, it’s created a surge in the need for industrial spaces as distribution centers become more necessary for retail operations. Parking garages can also be repurposed, as more drivers turn to transit, cycling, or walking, or as the increase in remote work makes large parking lots redundant.

The rise in remote working situations also changes office buildings. Shared workspaces will continue to be in high demand as many want to work in smaller buildings with communal spaces. Emerging industries, such as data analytics and artificial intelligence, each bring their own retail opportunities as well.

Contact me to discuss how these trends might impact your future commercial real estate investments and what opportunities might be available in your area.

3D Printing Adds New Dimension to Business

3D printing has become a common resource for small and midsize businesses. The technology offers the benefits of simplicity, efficiency, and affordability, and allows a manufacturer to quickly iterate designs and create new products.

3D printing supports a build-on-demand business model that enables instant on-site creation of prototype designs and customized merchandise as well as effective inventory management. The technology can be used to create practically any design or shape, and SMEs are leveraging 3D printing technology for various purposes. Common applications include making sample items for trade shows and promotional events, creating unique promotional materials such as 3D business cards, and test marketing new designs, features, and concepts.

Additionally, with the wide variety of materials used in 3D printing, including metals such as gold and silver as well as composite filaments, bio-inks that contain living cells, and pureed food paste, businesses can create innovative and aesthetically pleasing products that push the boundaries of craft, culture, art, technology, and even gastronomy.

3D printing is a quick and easy way to build prototypes, customized products, and marketing materials, and it can also be an additional revenue stream for a business. Many small businesses have found value in offering 3D printing services to other local businesses. Coworking facilities, print shops, and small fabrication shops are now adding 3D printing to their menu of services offered on-demand.

Professional 3D printers such as Sculpteo, Shapeways, and Voodoo are emerging to meet the demands of this fast-growing industry, which appears to be shaping the future of business models worldwide.

5 Ways to Combat Workplace Burnout

Burnout is a symptom of chronic stress, and most people assume it’s a result of overwork. But burnout has a heavy emotional component and is usually a combination of physical and psychological fatigue. If you’re feeling burned out, here are some ways to deal with it.

Find a physical release. Trips to the gym, laps at the pool, power walks around the block, or evening romps with the dog can help release stress, frustration, and anxiety.

Join a recreational group or take up a hobby. A hobby or activity can help refocus your mind on something other than your stress. Plus, it’s an opportunity to make new friends and possibly gain a fresh perspective on what matters in your life.

Make sleep a priority. As Shakespeare put it so eloquently, “Sleep knits up the raveled sleeve of care.” A good night’s sleep is rest for mind and body, and often things really do look different in the morning.

Don’t over-indulge. When we get stressed, we may resort to binging on comfort foods or alcohol. Self-medicating in this way can, in fact, add to the stress you’re already experiencing.

Practice meditation or mindfulness techniques. Meditation is said to be a vitamin for your brain. It has been proven to lessen anxiety, worry, and depression and enhance self-esteem and self-acceptance. Meditation can actually increase cognitive skills and creativity so you don’t just feel better, but you may actually perform better at your job and other tasks you undertake.

7 Adaptive Reuse Options for Vacant Properties
As every commercial real estate owner knows, it’s important to revive vacant property as quickly as possible since unoccupied property drains cash flow, impacts the site’s value, and poses liability risks. Vacant structures are linked to increased crime rates, including arson and vandalism. Plus, insurance, taxes, and maintenance must be kept up whether or not the property is occupied.

Many commercial property owners are finding that adaptive reuse, i.e., repurposing an existing building for an entirely new and different use, offers an opportunity to revitalize the property and give new life to the surrounding community.

We’ve included seven interesting examples of adaptive reuse that we’ve seen out there:

  1. Empty suburban shopping malls or retail complexes can be transformed into lifestyle centers featuring hotels, restaurants, gyms, co-working office spaces, retail and entertainment venues, and civic amenities such as libraries.
  2. Industrial buildings or warehouses have been retrofitted to become small workshops or craft breweries. The craft brewing business is booming, and large, sturdy warehouses are ideal for this type of business.
  3. Distribution centers have been outfitted for new life as vertical farms. These large open spaces are perfect for vertical indoor growing, and this mode of farming requires far less land and water than a traditional farm. In addition to urban agriculture, urban aquaculture is also becoming a trend.
  4. Schools are being repurposed as senior or communal living centers. Thousands of schools close down every year, and many of the campuses could easily be converted into residences for seniors or special needs populations.
  5. Empty office buildings can be modified to accommodate multi-family living quarters. The demand for multifamily units is on the rise, especially in metropolitan areas. Through adaptive reuse, the need for more urban living space is being met.
  6. Worldwide, cities are turning old industrial sites into public spaces that highlight the former usage and historic infrastructure of the area.
  7. Vintage railway trestles, cobbled pathways, and water towers add charm and character to the sites. Examples include the High Line in New York City, which attracts more visitors than any other destination in the City, and the Gas Works Park in Seattle, which features remnants of a coal gasification plant.

Adaptive reuse is often less costly and less invasive than new construction. Some cities offer incentives for adaptive reuse, such as flexibility in building codes and zoning requirements or tax incentives.

Adaptive reuse is predicted to play an important role in the real estate ecosystem of the future. Repurposing old vacant structures can give a neighborhood a new lease on life, bolster the local economy, and enable people to live, shop, and play close to their workplaces.

If done in a thoughtful and sustainable way, adaptable reuse can also help preserve the social and cultural heritage of a region and provide a boon to the environment.

In many cases, a brewery, food co-op, or senior housing complex moving into a vacant site is a harbinger of impending urban revitalization.


SA Realty Watch Group
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This Month – Market Research
Are you meeting your customers’ needs? Are there new products and services available that would help you improve your business? Answering these questions requires market research. Use the following links to learn how to use market research to improve profits and enhance your success.

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This newsletter and any information contained herein are intended for general informational purposes only and should not be construed as legal, financial or medical advice. The publisher takes great efforts to ensure the accuracy of information contained in this newsletter. However, we will not be responsible at any time for any errors or omissions or any damages, howsoever caused, that result from its use. Seek competent professional advice and/or legal counsel with respect to any matter discussed or published in this newsletter.
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