Commercial property market trends and their impact on investment opportunities

Hedge against inflation

In today’s real estate market, commercial properties provide a hedge against inflation, making it more appealing to investors. With the boom of eCommerce and increased online spending, many companies are looking for storage space to avoid supply chain issues, creating a lucrative opportunity for investors to secure high rent and limit the impact of interest rates on asset values.

Renewed interest in the office market

While remote working may have forced office assets to become less desirable over the last few years, 2023 is expected to change this with higher yields and the opportunity to purchase below-replacement values. With face-to-face interactions requiring physical locations, prospective investors should focus on making investments in commercial properties specifically for office spaces.

Focus on non-discretionary sectors

Properties in non-discretionary sectors that focus on essential goods are a great investment opportunity as consumer demand in these sectors is rarely impacted by economic conditions. Commercial properties that are directed toward non-discretionary sectors can ensure that you secure a sustained demand for your property and also enjoy the resulting long-term positive cashflow opportunities.

Increase in capital

Typically, a recession will limit the availability of capital, however, when it comes to commercial real estate many investors clamour at the chance to take advantage of lower interest rates as the potential for the property to increase in value rises. Therefore, this could be a good way to expand the portfolios of investors who are thinking of stepping into commercial property investment.