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Commercial Real Estate

r/CommercialRealEstate

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Posted by4 hours ago
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Posted by14 hours ago
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Posted by
Investor
20 hours ago

Hello all,

I am a recovering residential junkie. Thanks for having me.

I have transitioned to commercial real estate specifically industrial this year and I am loving it.

I am familiar with most asset classes especially the "trending" ones that are said to be the best.

Here's why I think industrial is the one to rule them all:

  1. Supply/Demand right now - There are places in the US that have a vacancy rate less than 1%! In my local market. the updated vacancy rate is 2.6% for H1 2022. Just like the rest of the asset classes, development has had its trouble with supply chain and labor shortages. It's been only until recent that some markets like Dallas the deliveries is higher than the absorption.

  2. Rise of E-Commerce - Online sales approximate 15%-17% of all purchases. People say that it will increase to 25%-30% in the next decade. People want their stuff and will probably want it faster. With rising interest rates, consumer spending has decreased, but on a longer time horizon, logistics, warehousing, and distribution will be needed. *I will mention that I believe there will be disruptive technology in this space, as well as the decrease cost of current technology*

  3. Onshoring/Reshoring - Overseas manufacturing has been dominate in the past decades. With supply chain, shutting down, log jams at the ports multiple businesses are bringing back some/all manufacturing to North America.

  4. Just in time delivery -> Just in case inventory - Supply chains were completely disrupted and logistics became the star child of the line item budgets. Lots of business ordered inventory in excess just to have it! Now, with the slowdown they are needing to move it, but I believe the habits and ways of doing business have changed.

The next couple years may be a little shaky, but my outlook on the long term is well located industrial wins!

What am I missing?

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Posted by1 day ago
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About Community

/r/CommercialRealEstate - Place to discuss Office, Retail, Multifamily, Industrial, Hotel, Land, and special purpose commercial real estate
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Created Jun 30, 2009

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