While the extent of the local and global economic recovery after the Covid-19 is unclear; however, there are still some chances for investors to take advantage of key trends that we believe will boost the performance of commercial real estate in 2022.
The current situation, featuring the omicron variant, inflation, and stock market volatility, unique circumstances present for a commercial real estate that increased significant capital and gained momentum.
We believe that all positive trends and new chances should be balanced against the multilayer pandemic playing out the impact. The first six significant trends listed below will increase performance in the real estate industry.
Since long-distance work for white-collar workers has become the norm, returning to the office is predicted and often delayed again. The report points out the trends in the office market to bring employees back to their desks by 2022, prioritize health and wellness, embrace direct collaboration, and face multiple logistics challenges related to hybrid work schedules.
Business travel is expected to boost retirement in 2022, which, according to the report, is good for the hospitality sector. In preparation for this expected boom, luxury hotels will continue to undergo major renovation projects.
2021 was described by the COP26 Climate Conference, which committed governments and organizations to global emissions reduction goals. Investors are increasingly looking for more transparency and disclosure around ESG performance and targets. As ESG develops beyond valuation tools and is rooted in the DNA of our assets and cities, the actual gross income of an asset will be greater than the income and value.
Urban centers and cities are our economic, cultural epicenters, and technology will be a key pillar in the successful growth and transformation of our industrial economy. COVID is fundamentally challenging to urbanization, with dense living and proximity in a pandemic environment being a major challenge.
That is why, as the world emerges from a pandemic, it will be more important than ever to reconsider how to organize, plan and improve urban facilities, and we have the opportunity to make our cities better again. In short, our cities are still here, but they are young and accessible.
Manufacturers, retailers, and third-party logistics companies are restarting supply chains to users in the industry, attracting them to sites close to population centers, highways, and airports.
With less space near ports, developers will want to move inland, while trying to offset rising transportation costs, the report said.
As investor interest in the asset class reaches a historic peak after the global financial crisis, the commercial real estate market has expanded in terms of sector coverage and depth. Investors looking for high return assets are now moving beyond the traditional office, retail and industrial sectors to other emerging markets such as healthcare, rental, data centers, and other sectors that benefit from strong demand-side fundamentals.