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The Empire State is home to many brands and companies and the popular Wall Street. The state of New York is also home to 2,053,393 commercial properties with many uses. Some of the uses for these commercial properties include retail, multifamily uses, hospitals and hotels, offices, industrial use, and land. The potential found in New York’s commercial properties seems exciting for new investors, but some are worried about commercial real estate. Commercial real estate has seen a dip in its success from the pandemic.
When comparing statistics from years that are pre pandemic to current dates there is a trend that shows less use of commercial real estate. This can be due to a multitude of reasons, one big one is companies switching to remote work. When the pandemic hit many companies opted for remote work so many office spaces were left empty. Even now with restrictions lifted many businesses have found many benefits to having remote work and have continued to offer this option. However; some companies are starting to end remote work and as this happens office spaces will be needed again.
Other issues that commercial reality has been faced with include the seven rate increases that happened going through the year 2022. This could lead to New York’s real estate sales dropping 15.9% going into the year 2023. The country was faced with layoffs and New York was no exception. Companies such as Twitter and Meta laid off 1289 employees in November of 2022. Other companies have followed suit as they focus on restructuring their business to a post pandemic culture and work environment. With some of the uncertainty underway some investors have put a pause in their investments and are waiting for the market to correct itself.
Overall many investors believe that, besides office spaces, commercial real estate will continue to be a strong investment. Opportunities in this market will revolve around data centers and industrial settings as we move forward with our supply chain demands. There are also positive outlooks for multifamily units and hospitals as well which will help increase commercial real estate. Silverstein Properties is looking towards outside sourcing to fund a 1.5 billion dollar project to turn office buildings into residential units.
Source: ChessRealtors.com
