Welcome to another edition of Mark’s Market Update.
On a weekly basis we have been talking a lot about residential real estate and not much has changed (low inventory and strong buyer demand). But we have had a lot of questions about what is happening in the commercial market.
When we look at commercial we are talking about three different types:
- Strip centers for retail and restaurants
- Office buildings
- Multi-family apartments
All three of these are challenging. With retail being the most challenging, office buildings second and then multi-family.
-However, multi-family rent collections have exceeded expectations, in March and April. Rent collections have been very solid; considering, what has happened over the last couple of months. We still see a lot of strength. High buyer demand. Not a lot of availability -so we do see strength in the multi-family market and values continue to increase.
When we’re talking about retail:
Very challenging, as you see in the news with restaurants and retailers closing - strip centers are under performing -vacancies are high and we’re going to continue to see this trend continue over the next 6 months. A lot of retail and restaurants will go out of business. However, in past downturns new and re-invented entrepreneurs will back fill those vacancies and create new concepts, restaurants and other. But in the short term, it’s not looking very positive for the strip centers.
Office buildings, this is a dynamic changing everyday. When we see companies like Twitter, Facebook, Square, Shopify and others that are allowing their employees to work at home. This is a changing dynamic where no longer is the square footage needed for many of these companies.
Even in our company, many of our operations department employees are continuing to working at home and will continue to do so.
We’re increasing productivity on a daily basis. -We’re learning to work within the ecosystem of working at home. We are seeing many benefits of working from home family life work harmony.
When you’re looking at the overall commercial market excluding the apartment, it is a very challenging environment, and we don’t see that changing anytime soon. They maybe some great buying opportunities soon.
If you have any questions about the commercial world or the residential world, don’t hesitate to call, email, or text. Thank you so much and have a great day.