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A Guide to Commercial Real Estate

A Guide to Commercial Real Estate

The following is a great article on the commercial real estate market written by Rick Tobin of Premier Hotel Realty, a South Florida Commercial Real Estate Brokerage.

The Changing Faces of Commercial Real Estate

The commercial real estate market (“CRE”) is constantly changing and evolving. The commercial real estate market is growing in some areas, and shrinking in others.  In fact, it’s changing so fast, sometimes it’s hard to tell which direction things are headed!

According to a recent article from Forbes magazine on the commercial real estate industry, commercial real estate values are expected to continue to rise in the years ahead in various sector industries. This is due to the evolution of how properties are marketed and used as well as how those properties are changing their character.

Here are the major changing segments of the CRE industry to watch:

  • Multifamily
  • Hotels
  • Office
  • Retail


The Millennials have changed the way multifamily properties are being developed and marketed. A growing preference for smaller, rentable spaces and the tiny house movement has shaped the way developers are looking at apartment complexes. According to the most recent PEW survey, greater numbers of Millennials tend to prefer to rent rather than own. The American dream of owning a home has shifted to 400 square feet homes, often with a view of the ocean and numerous recreational amenities. Many Millennials want to be mobile, and to avoid the traditional ties of ownership.


While hotel occupancy has remained strong, many sectors are competing with “shared accommodation” platforms, like AirBnB and VRBO, leaving hotels to market to events customers and the business traveler. High speed internet is in huge demand and travelers insist that coverage be provided throughout facilities. Workspaces are incorporated into rooms and chargers and electrical outlets must support today’s technology toting travelers.


The latest trend in workspaces is the demand for shared office space. This new work style helps incubate small business in new ways. Small, flexible spaces are in high demand. Cutting overhead costs, many office spaces are cohabitated by related synergistic industries that benefit from partnering with each other. Many shared spaces have networking and business partnering all in one floor and the occupants pay ala carte prices from a Chinese menu.


The rise of e-commerce sales has reshaped many traditional retail spaces. Companies are tailoring their space for employees instead of their clients. While their website is designed to attract their customers, their retail space is designed for employees. Storefronts may be a thing of the past in this e-commerce world, and stores may become showrooms for behind-the-scenes fulfillment centers.

What does all this mean?  With change comes opportunity for those with vision and flexibility to take advantage of the morphing commercial real estate industry.