When it comes to commercial real estate, the post-pandemic economy has grounded some asset classes while others are now rising stars. Multifamily and industrial are two sectors proving especially resilient to recent economic hardships. Hospitality and office, not so much.
Meanwhile, store closures and a consumer base hooked on e-commerce have caused retail vacancies to climb. Property values are lagging by comparison and investors are eager to grab up the deals. Like the adage, when one door closes, another door opens, and adaptive reuse is helping old buildings to find new life. The idea of rehabilitating and repurposing a property rather than building a new structure from the ground up is gaining popularity.
The prevalence of storefront retail we once knew may not return. Office workers now have a taste for working at home, leaving behind underused spaces. Empty warehouses are blank canvasses, primed to better serve today’s consumers. Property owners can view the changing landscape as a loss or they can seize the opportunity to convert their buildings into better uses.