Our readers may have seen several of our previous posts here that examine the differences between the commercial real estate market and the residential real estate market. In South Florida in particular, the differences have been stark for the last several years. Since the depths of the housing crisis nine years ago, the residential real estate market in South Florida has, for the most part, rebounded nicely. The commercial real estate market, on the other hand, has lagged behind. But, is the market for commercial property finally catching up to the residential market?
There is some recent data that indicates that, not only is the nationwide commercial real estate market improving it may be doing so by leaps and bounds. In fact, the most recent upswing may not even be over yet, and some data points to commercial real estate currently hitting a peak in value that has never been seen before. The types of commercial property that have been examined in this upswing include retail locations, office buildings and industrial property.
There was a time not too long ago when commercial property owners were facing serious financial difficulties due to the problems presented by securing commercial tenants or finding buyers for commercial property. But the economy, by and large, has been recovering over the last few years from the "Great Recession," and it appears that many companies and businesses throughout the country may be buying back into the belief that expansion and investment is a good path to follow.
However, while the data on the nationwide commercial real estate market is encouraging, localized markets can be difficult to predict. South Florida companies that may be looking into a move in the commercial real estate market will want to make sure that they have the best information about the local market.
Source: housingwire.com, "Commercial real estate prices hit historical peak," Kelsey Ramírez, June 6, 2016