Lindner Properties 2023 Commercial Real Estate Outlook
Commercial Real Estate Market Growth Predictions in 2023
2023 is just beginning, and commercial real estate markets throughout the country are projected to look fundamentally different for 2022. From population growth to changing consumer preferences, there are many key factors to consider as the global economy develops and changes over the next decade. So what is the future of the commercial real estate market in Columbia, MO, and what are some key trends shaping the real estate landscape moving forward?
Commercial property markets have been experiencing sustained growth over the past few years. This is particularly true for emerging markets, where demand has been outpacing supply. Emerging markets are experiencing an increase in areas such as tourism and retail, which has sparked demand for property investment in sectors such as restaurants and shopping centers. This has led to increased investment in these types of properties. There are several factors contributing to this growth, and the same factors could lead to further growth come 2023. These factors include population growth, economic growth, and demographic changes.
1. Population Growth
The population growth rate will continue to grow over the coming years. The population of the U.S. is expected to reach over 330 million. City population growth is among the most important trends to watch. In order to keep up with this growth, many cities across the country are expanding their footprints beyond the city center and into growing suburbs. These areas will have a growing demand for commercial properties.
2. Economic Growth
Economic growth has been a major driver for the growth of investment property markets over the past few years. This is expected to continue next year as demand continues to outpace supply, primarily through an increase in capital investments like purchasing property or equipment.
3. Demographics
The demographic changes that will take place over the coming decade will significantly impact investment property markets. As the baby boom generation begins to retire, there will be a shift in the desired type and location of commercial properties. This will result in a higher demand for commercial properties with more active uses, such as open areas and shopping centers.
The U.S. is also expected to become more ethnically diverse as well. This diversity is likely to drive much of the growth in cities. This is because many businesses choose locations that are accessible to these diverse populations.
4. Environmental Factors
The impact of global warming has led to many countries reducing their carbon footprint by increasing the use of renewable energy sources. This is a significant factor in the real estate market as it will push people to buy properties in areas that have lower emissions. This will increase demand for green space due to its ability to alleviate global warming and help reduce the impact of climate change.
The rising carbon footprint has also led to increasing awareness of environmental concerns for individuals interested in buying an investment property. In addition, it has led to investors being more concerned about purchases from real estate companies that do not embrace the conservation of the environment. These factors will continue to drive demand for investment property in 2023.
5. Technology
The rapidly changing technology will continue to shape the investment property market as it continues to grow over the next decade. The industry is being transformed by technology to provide better efficiency and increase profitability. Technology is also leading to significant changes in investment property markets by making it easier to invest in investment property. This will result in a surge of investment property investors.
6. Services
The service sector is increasingly becoming the most sought-after for many businesses. Consequently, it is one of the fastest-growing sectors in investment property and plays a key role in pressure points driving demand forward. This is because it is essential to many economic sectors, including tourism, retail, and manufacturing. In addition, it will continue to play a part in the future economy.
Stay on top of commercial real estate industry trends with help from the experienced team at Lindner Properties
These trends will have long-term effects on the investment property industry. It is important for buyers and sellers to take into account these trends and how they are likely to shape the future market environment. This will help ensure that they make the best decisions regarding their investments. Lindner Properties experienced team and affiliated property managers can help business owners in central Missouri and Destin, Florida navigate changing trends and markets.
Current economic trends are affecting the way business owners rent property in Columbia, MO, central Missouri, & Destin, FL
Investment property is heavily dependent on other industries for investment and return. This is true for sectors that provide capital to the industry, as well as property owners who use the income from their properties to fund other business ventures. Therefore, these industries have a significant impact on investment property itself which in turn plays an important part in shaping U.S. economic growth.
The investment property industry is also heavily influenced by macroeconomic forces. The major macroeconomic factors that will have an impact on the industry come 2023 include the following.
1. Rising Rates of Inflation
High inflation rates have impacted investment property values over the last few decades due to the rising cost of construction. Right now, things are getting uglier. The inflation rate hasn't been this high since the 1980s, with the latest inflation figures at 7.75 percent.
2. Rising Interest Rates
Another factor that will significantly impact investment property is rising interest rates, which have been inching up with no signs of slowing down. The Federal Reserve has raised interest rates several times in the recent past, and there's a possibility that it will raise them again in the near future due to an increase in inflationary pressure. If this happens, it is likely to have a major impact on investment property valuation.
3. Hot Money Flows Into the U.S. Real Estate Market
Investors are flooding the United States due to a lack of returns in other investment opportunities. This has increased demand for quality assets, which has helped lift U.S. investment property prices. However, it has also led to more capital from other markets entering the U.S. real estate market, which could drive prices up even further.
What type of commercial properties are expected to flourish in 2023?
1. Retail Properties
Income growth has been sluggish in recent times, and this has raised concerns over the future of retail real estate. The outlook for retail space for lease is expected to be bleak in 2023. However, it will mostly depend on the location and retail category. The central Missouri and Destin, FL areas are no different.
For example, department stores are expected to continue to perform well in some locations. Shopping centers in well-populated residential areas are also expected to continue to perform well. The performance of retail properties also depends on the overall economy's health in 2023. Fortunately, Lindner Properties offers a variety of retail locations in mid-Missouri and Destin, FL for business owners to invest in.
2. Industrial Properties
The industrial sector is expected to have a relatively positive outlook through 2023. This is due to projected economic growth, especially in ecommerce. Strong investor interest in logistics real estate is also expected to contribute to the positive outlook. However, it will largely depend on how well the economy performs in 2023 and beyond. Lindner Properties office and multi-use properties can be beneficial for ecommerce and drop-ship operations.
3. Office Properties
Office properties have been performing quite well in the recent past. However, their outlook is relatively uncertain as it will depend on several factors, such as the location, availability of amenities, and the economy. In general, office properties in urban and suburban locations are expected to perform well in the coming years. Office properties in large metropolitan cities and trade areas are also expected to perform well. Lindner Properties is proud to offer a variety of turn-key office properties in central Missouri.
The best opportunities for commercial buildings for rent in Columbia, MO & Destin, FL
These macroeconomic factors indicate that there may be a mild or moderate recession come 2023. However, there's no way of knowing for sure. On the one hand, factors contributing to market growth may prevail. On the other hand, macroeconomic factors that are hindering economic growth may prevail.
Investors need to be well informed of the market trends and their implications so they can take appropriate measures beforehand, including taking advantage of current opportunities in the market. For the best prospects, investors looking for commercial property for lease should consider investing in certain property types and locations depending on their risk appetite. Lindner Properties can help you navigate the ever-changing currents of commercial property leasing with ease.
Ready to Invest in Your Business? Contact Lindner Properties to Learn About Commercial Real Estate for Lease in Columbia, Jefferson City, Sedalia, MO & Destin, FL
At Lindner Properties, we work with you to select the right property for your investment needs. As the best commercial rental experts in Columbia, Missouri, we go the extra mile to provide you with all the necessary information you need to make an informed decision on available commercial real estate listings. Your financial advisor is always available to discuss any questions you may have. We would love to help you find the perfect investment property asset for your goals.
