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5 Commercial Real Estate Trends That Are Dominating In 2021
In the first quarter of 2021 a record high of investment in the Indian realty sector. A staggering 3% to 12% increase in demand for residential realty was witnessed in real estate market hubs like Mumbai, Hyderabad, etc. Whereas we also see a considerable increase in commercial properties such as office space, shops, space in business centres, etc. Though we have read and heard a lot about how the residential real estate sector got stabilized after the havoc stirred by the COVID-19 pandemic, demonetization, GST and RERA, not much has been discussed about the commercial real estate sector. It is extremely important to understand the real estate trends of the commercial sector as it plays a very crucial role in the country’s economy.
In this context, let us discuss 5 important commercial real estate trends that are dominating in 2021.
The rise in demand for industrial real estate
In the past year, there was a considerable increase in the demand for industrial real estate in the commercial real estate sector. It is expected that the demand for industrial real estate is going to continue to grow in the coming years. Such increased demand is the result of the growing e-commerce marketplaces. The majority of the commercial property investment is done for logistic services and in order to set up warehouses and logistics centres for their products. As a result, there will be a massive increase in the leasing value and rental value.
Commercial real estate tech evolution
In today’s times, technology plays a very important role in the real estate sector. The commercial real estate sector is also dependent on technology. New technologies are being adopted by commercial builders and developers in order to make the process more environment-friendly. The tech evolution in the commercial sector is booming and is poised to grow in the coming years. There have been many technologies that have provided security solutions for various issues like fire, theft, etc but have also provided management solutions on the cloud. Technological investments are going to increase with the advancement of technologies like the internet of things, automated systems, blockchain, etc.
Office Spaces on Pre-Commitment
Commercial property developers and real estate investors would lease out those properties that are ready for possession or ready to move in. But today, we see that office spaces and commercial areas are leased out on a pre-commitment basis. Because of the growing demand of commercial players, people are pre-booking office spaces in under-construction buildings. It is not just the commercial properties, but also under-construction properties that are in high demand.
Physical Retail Stores Boom
As Amazon has launched its retail outlets like Amazon Books, Amazon Go, Amazon 4-Star, etc, e-commerce entities have realized the importance of physical retail shops. From just being a sole online vendor to launching their own brick and mortar stores, businesses have realized the prominence and importance of physical outlets / retail shops.
Millennials Migrate to Secondary and Tertiary Markets
Millennials are moving towards the outskirts of the cities to settle down in life as metropolitan cities are getting over-saturated with professionals. These areas are known as hipsturbia or urban burbs. As the millennials are moving towards the outskirts, the retailers are showing interest to invest in such locations in order to cater to the millennials. Also, millennials are expressing interest to invest in commercial property markets and risk-free markets like the secondary and tertiary markets.
These are some of the commercial real estate trends that are dominating the year 2021. Both retail investors and buyers need to be aware of the commercial property market and the real estate trends in India.
