Investing in real estate can be a great long-term financial asset. If entered into correctly, it can provide a source of passive income and equity for the long haul. Many people invest in commercial real estate for this exact reason.
With the potential for a real estate bubble at an all-time high, many people are beginning to wonder what the future of commercial real estate will be and if it is still worth the investment. We’ve researched five expert sources to find out if commercial real estate investment is a must or a bust.
Forbes: Current Conditions are Favorable
According to Forbes, due to available debt and significant capital, there is likely to be continued growth in the market. There is also a lot of movement outside of urban areas. These rural areas are gaining traction because of their abundance of land and opportunities. This all bodes well for an increase in growth in the commercial sector, signaling that commercial real estate is still worth the investment.
J.P. Morgan and Chase: Commercial Real Estate Bounce Back
According to J.P. Morgan and Chase, now that the pandemic is settling down and normalcy is beginning to be reintroduced, the commercial real estate market will bounce back in 2022. They believe that vacancies are going back to pre-pandemic standards. Also, a lot of infrastructures are being introduced because of new aid provided to cities and states nationwide. This new infrastructure will help increase the desirability of commercial real estate in cities and suburban areas.
EisnerAmper: Real Estate Capital is Abundant
According to EisnerAmper, commercial real estate investment will continue to be popular for core consumers looking to round out their investment portfolios. Banks are in a good position to lend, foreign investors are coming back into the market, and non-traditional lenders are on the rise. This makes for a prime opportunity to enter the commercial real estate market and invest in your future.
Dealpath: Commercial Real Estate Opportunities
According to Dealpath, a lot of businesses were affected by the COVID-19 pandemic. Due to this unfortunate pandemic, many of these businesses have paired down or changed to hybrid work environments. This means they are using their large commercial buildings less and putting them on the market to cut unnecessary costs. This provides a great opportunity for new commercial real estate investors to come in, grab a property, and mold it to their own vision.
Deloitte: The Future is Optimistic
According to Deloitte, the future of commercial real estate for 2022 is optimistic. Due to the fact that many large firms rely on legacy technologies, they are more likely to keep them and expand the infrastructure. This means that they will be looking to lease or rent commercial spaces to house said equipment and personnel to manage these technologies.
Additionally, companies are also recovering from the pandemic financially—many companies who have survived the pandemic state that their expected revenue should surpass that of 2021.
Non-Traditional Lending: An Investment
Some commercial real estate investors are worried that the government will increase interest rates due to inflation. This may cause concern for current and future investors alike. Luckily, bank lenders are no longer the only ones on the market. A non-traditional lender, such as EMCAP Lending, can assist you in acquiring an investment loan quickly and efficiently without the same complications that a bank provides.
Commercial Real Estate Investment: A Positive Trend
Overall, the outlook for real estate investment for commercial property is positive. Real estate experts nationwide have stipulated that this investment will positively impact real estate investment portfolios everywhere.