As we prepare for the upcoming year, there’s no better time to reflect on the industry trends that shaped commercial real estate in 2015. The nation’s recovering economy, growing millennial workforce and ever-changing consumer preferences are just a few of the many factors that played a role in transforming CRE.
Take a look at four of the top trends that shaped CRE this past year:
The rapid pace of technological advances like mobile apps and crowdfunding capabilities, coupled with consumers’ growing desire for immediacy, led to the continued growth of e-commerce in 2015. While many businesses, including Amazon, saw the benefits of a multi-channel sales approach, overall sales records indicated a boom in e-commerce.
To adjust for fewer physical customers, retail stores in many secondary and tertiary markets downsized their store counts and building sizes. However, the growing need for warehouse and distribution space led to a higher demand of commercial and industrial spaces. This specific trend will continue to be a major CRE factor in the coming months.
Millennials & Urban Development
By the year 2020, Millennials are projected to form at least 50 percent of the global workforce. This younger demographic challenged the conventional work environment by demanding innovative, non-traditional workspace. This year, to attract and retain this new demographic of workers, many companies and organizations moved their businesses to more urban environments. This shift helped boost many local economies, as millennials often live, eat and entertain close to the workplace.
Innovative spaces became increasingly popular in 2015 as businesses learned the benefits of providing consumers with a variety of spaces. These properties, which combine residential, commercial and industrial real estate, foster diverse environments that were not possible in more traditional developments. In addition, businesses have seen increased efficiencies and lower costs by taking advantage of multi-use, multi-purpose properties.
Similar to mixed-use space, collaborative space was another common trend this year within the commercial real estate industry. To satisfy the evolving desires of their workforce, many companies traded in stuffy cubicles for a more open floorplan that encouraged employee collaboration and creativity. Innovative companies like Pixar and Google spearheaded the popularity of these collaborative spaces, inspiring businesses to knock down divider walls and upgrade to community tables and open workspaces. While reviews of this new office design trend have been mixed, many companies attribute higher productivity, creativity and overall moral to their new collaborative spaces.
With new technologies and innovations being created every day, significant disruption in the coming years is inevitable. Growth is on the horizon for 2016, proving now is an exciting time to be in the CRE industry!