As 2020 continues to bring unexpected events, investors may be wary of expanding their portfolios in the commercial real estate market. However, those who think outside the box and stay ahead of the curve can prosper in Houston land and commercial investments.
These are the latest commercial real estate trends to look for in the second half of 2020.
Mixed-use developments
These complexes combine housing, office space, restaurants, amenities, green space and retail for a walkable model that appeals to those who want the convenience of the city without the congestion. Many of these properties also feature hotels. For example, Springwoods Village, the 2,000-acre mixed-use project that opened in 2018, includes the upscale Houston CityPlace Marriott.
Industrial repurposing
As department stores, malls and big-box retail mainstays continue to go out of business, online firms are taking advantage of these spacious properties for warehousing and distribution. Vacant commercial construction exceeding 250,000 square feet is the sweet spot to attract companies that need industrial footprints.
A notable example of this trend in Houston would be the repurposing of a dark grocery store into an H-E-B distribution center.
The rise of nanowarehouses
More than ever before, Americans expect fast, convenient online delivery as in-person retail continues to decline. Expect the nanowarehouse concept to spread from big East Coast cities to the Houston area. These small storefronts are typically less than 1,000 square feet and offer local delivery and a limited stock, serving as neighborhood outposts for those massive distribution centers discussed above.
Increased multifamily demand
Apartment complexes, townhome rentals and other multifamily residential complexes will likely see high demand in the second half of the year. As unemployment increases, many would-be first-time homebuyers have expressed plans to delay a purchase. The National Association of Realtors reports that Class B and C rental properties will be among the most desirable investments.
Use these projections to make smart moves when navigating the Q3 and Q4 real estate market.