The pandemic brought about extreme changes globally. With lockdowns implemented all over the world, plenty of businesses and corporations temporarily closed. It has been four years since then, but has the commercial real estate industry recovered from its losses since then?
Due to the established work-from-home setting during the pandemic in 2020, office space value has rapidly dropped, leaving commercial buildings empty. This year, despite organizations slowly implementing onsite or hybrid setups, it is still not enough to make up for the losses in the past years. According to reports, there is an anticipated loss on office properties amounting to $1 trillion, and about $1.2 trillion in commercial mortgages are scheduled to mature this year and in 2025.
Despite these, there are three things you still have options when it comes to the real estate market:
Buy new space
Because of the current economy, buyers may be able to get commercial properties at a cheaper price. If you have enough funds and are looking to invest, you can do a canvass in an area you think would rise in market value in the future. It is important to seek legal or financial professional guidance to assess risk and navigate complicated – and expensive – real estate transactions.
Sell owned property
If you already have an existing real estate property, you can put it on the market. To do this, you will need to have an appraisal done to determine property value, prepare the property and make it marketable. You can work with real estate, financial and staging professionals to help you get the space ready for sale.
Rent space out
Another option is to put a space up for rent. If utilizing the space is a challenge, but you don’t want to let it go, renting it out can increase your monthly cash flow. Just remember to follow the guidelines when it comes to leasing commercial property. Renters have rights just as much as the property owners, and it is essential to know both for smooth transactions.
Whatever you decide to do, keep in mind that this is not a decision to make alone or lightly. Getting input from industry professionals and taking a close look at your current situation, needs and risk tolerance will be vital.