Historically speaking the summer months tend to slow down in the commercial real estate world as schools are closed, children are home and vacations become the priority. This is a contrary theme to residential real estate where home buyers, especially those with school aged children, are looking to make a move during the summer months as to not affect their work schedules and to start their children off on the right step at the start of the school year.
This year, however, the general consensus amongst CRE experts is that 3rd quarter volumes have actually gone up. This is due in part to a static pace in the prior two quarters resulting in a “pick up” this summer. Another factor, one that is regularly spoken of, is the advancement of technology. Real estate transactions have increasingly taken place remotely, allowing documents to travel freely and quickly via the web with funds being wired remotely. The days of writing checks and signing paper documents are going further and further in the rearview mirror of real estate.
Let’s make no mistake about it, though, that CRE has been red hot for quite some time now – led by the emerging e-commerce industry. While we do not see a slowdown in the near future for e-commerce users gobbling up Class A industrial space, we are seeing more Class B and C space coming onto the market. We predict a formidable adjustment in the retail market, while office will continue to stay static outside of major metropolitan areas.