While in 2024, Commercial Real Estate (CRE) owners faced some challenges from an evolving economic climate, experiential consumerism growth, and quality tenant acquisition, some experts predict 2025 will usher in a new, positive economic cycle for the sector. Here are major trends shaping CRE in the new year.
CBRE reports that years of limited retail construction have driven the national availability rate below 5%. This is expected to result in higher asking rents in 2025, prompting retailers to seek longer-term leases in desirable locations.
According to JLL, emerging trends in life sciences, including AI advancements and an increased focus on R&D, require companies to reassess their portfolio strategies, lab needs, and locations. This may involve creating more flexible and tech advanced laboratory designs.
Demand for industrial buildings near or with access to the U.S.-Mexico border is set to rise due to anticipated changes in trade policy. They anticipate increased need for distribution facilities along I-29,
and I-35 corridors, particularly benefiting San Antonio, Austin, Dallas-Fort Worth, Oklahoma City, Kansas City, Des Moines, and Minneapolis.
CRE experts are observing whether the demand for warehouses will expand to other industrial properties. AI-driven data centers, cold storage facilities, EV battery plants, and quantum computing campuses are expected to gain interest, despite their challenges. Community groups now also support these properties due to their strong economic benefits.
ESG or Impact Investing is a growing trend. Zubin (Ruzbeh’s son), in one of our conversations suggested that if everyone takes small steps to be eco-friendly and measure their own carbon footprint, our planet would be greener. He uses a free tool, which we are sharing with you: www.footprintcalculator.org.
References: https://www.forbes.com/, https://www.cbre.com/insights, https://www.us.jll.com/
