From COVID-19 to rising inflation rates, there's no doubt that the commercial real estate sector is reeling from numerous shocks. And although the US is not technically in a recession, there's a risk we're heading that way.
In these circumstances, you might wonder whether to hold, buy, or sell your commercial investments. Although you should seek legal advice from a commercial property attorney before taking action, here are some assets which could be stable investments during a downturn.
Remote working boomed during COVID-19, but there's still demand for office space.
Experts suggest that smaller “satellite” offices may become more popular, helping workers maintain a healthier work-life balance post-pandemic. On the other hand, office space could become more flexible and collaborative, which may increase the demand for larger, open-plan spaces.
There's no saying for sure which way the pendulum will swing on office space, but these commercial assets could prove robust.
As businesses locate to smaller premises and consumers downsize to conserve funds, self-storage assets could prove safe options for commercial investors.
- Self-storage customers are often driven by need, so they may be less price sensitive than other individuals.
- Data from previous downturns suggests that self-storage units become more popular during recessions.
There's no such thing as a sure investment, but self-storage facilities have a reputation for being fairly recession-proof.
Despite a trend towards virtual appointments and digitized healthcare, we'll always have a need for bricks-and-mortar healthcare spaces such as:
- care homes
- surgical facilities
Traditionally, healthcare real estate performs well during recessions, and it could be a safe harbor in the next storm heading our way.
Industrial & Logistics
Given the current political climate, we could see an increase in demand for domestic warehouse space rather than relying on international supply chains. And as supply chains play catch-up after COVID-19 and the retail sector recovers, warehouse space could be worth holding – or buying – for now.
Call a NY Commercial Real Estate Attorney
Typically, commercial real estate weathers market downturns well, and it's often a good long-term investment option. However, before you make any investment decisions, retain an experienced commercial real estate attorney.
Melvin Monachan, Attorney at Law, can help with your real estate concerns. Contact the team online or call (347) 389-1682 now.