The commercial real estate sector tends to get overlooked amid spring selling season in the single-family housing market, but a couple of interesting stories have caught my eye recently and they’re ripe for localizing. And the root causes of the activity can make for some deeper local economy stories.
First, the Wall Street Journal reports that “Developers turn former office buildings into high-end apartments,”— an interesting phenomenon that speaks both to the glut of office space indicative of a sluggish economic recovery and the rising demand for residential rental units. (It’s also kind of an interesting illustration of changing work habits, as more people work from home.)
Here’s a similar story from WUWM in Milwaukee, about a former downtown Blue Cross Blue Shield building that may be turned into apartments for people who want to live “where the action is.” Why not see if you can find similar examples of repurposing in your area, as a novel way of approaching a view of the commercial real estate scene?
The real estate information firm CoStar says demand for office space is picking up, but slowly (they may be worth a call to see if they’ll provide market-specific data for your region) while GlobeSt.com reports that the multi-family market in Houston is “smoking hot” and it’s sizzling elsewhere too, according to other coverage on the industry site. Demand for apartments and other rentals has been strong since many people abandoned home ownership in the recession, and reports say that jobless college grads and other demographics are driving continued interest in multiple dwellings. Check permit activity, talk with construction firm and banks — is apartment development outpacing office space development in your neck of the woods?
These local reports from the real estate firm CBRE might be of help, and
Some quirky areas of the real estate market make for interesting features, too, including:
For several years now, investors (individual and institutional) have been snatching up foreclosures and other properties in college towns and developing them as high-rent student housing; I seem to recall one firm even was issuing public shares. If you haven’t hit that story yet, get this:
There’s a conference on the topic coming up in June in Las Vegas; agenda items range from financing to trends and “demands from today’s student,” even if you can’t attend, keep tabs on the conference newsroom and speakers list for potential sources. Real estate firms like Colliers have actual student housing business units; they may be able to provide insight as well.
In the season when spring cleaning, decluttering and getting rid of stuff at yard sales is top of mind, imagine my surprise to see that the big real estate analytics firm Reis Inc. has initiated formal coverage of the self-storage sector of the commercial real estate industry. The company says it has detailed data on 279 submarkets in the U.S. — why not ask if they’ll share what they know about self-storage in your neck of the woods? They’re collecting information about vacancies, rents, etc. that could help you sum up the size of the self-storage market in your area. And don’t forget the consumer angle — who’s storing all that stuff, and why? Downsizing boomers? People who lost homes in the recession? Small businesses?
The Self-Storage Association, the industry trade group in the U.S., says there are nearly 50,000 facilities nationwide and that the industry generates $24 billion a year in revenue? Who knew? More interesting ideas at The Storage Facilitator blog.