Real Estate Trends Emerging from the Pandemic
Because of the COVID-19 pandemic, some housing trends will accelerate, some will come to a halt, and some will spawn entirely new areas of growth, experts said during the Urban Land Institute’s virtual fall conference.
For example, the migration from cities to suburbs, which millennials led prior to the pandemic, has only sped up; multifamily developers are no longer engaging in amenity wars to attract new residents; and housing trends reflecting health and wellness movements are emerging.
ULI released its Emerging Trends in Real Estate 2021 report Wednesday, culling insights from more than 1,600 leaders in the real estate industry. Some of the following trends, according to the report, are accelerating during the COVID-19 pandemic:
Ninety-four percent of real estate professionals say they expect companies to adopt a policy of at least part-time remote work, which will have implications for office space, according to the ULI survey. But more than 60% of respondents say they also believe that many office tenants will expand their footprints to support new ways of collaboration and interaction. Companies are recognizing that in-person workplaces are still critical to maintaining company culture, innovation, on-boarding new employees, and training.
Gateway markets may struggle for the next three to five years to return to their pre-pandemic highs. But they’ll likely re-emerge as major hubs because of their dominance in entertainment, finance, technology, and education. Some cities may add more green space as they look to add greater outdoor activities to attract residents.
As discount and online stores grow in favor, demand for large retail chains likely will lessen. More than 80% of respondents to ULI’s survey say COVID-19 has accelerated a shift in retail that was already occurring due to online competition. Industry analysts predict smaller physical retail footprints moving forward, likely leaving large commercial vacancies, which will lower rents.
Safety and health concerns in buildings.
Eighty-two percent of survey respondents say health and well-being will become an important factor across all real estate sectors, particularly hotels, office buildings, and restaurants. Companies will place a focus on advanced technology and new services that can offer cleaner buildings, such as greater HVAC infrastructure, sensors, touchless entry, and contract tracing apps. In the residential market, demand likely will increase for smart-home technology, touchless controls on sinks, motion sensor lights, and oversized windows to allow for more natural light and fresh air.
October 16, 2020.Florida Realtors. ULI: 8 Real Estate Trends Emerging from the Pandemic.
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