Welcome to the new year (and the new decade)! It’s the time of year where many of us start to think through resolutions and goals, and also harbor some curiosity as to “what’s next?”
To kick off the new year, our team put together thoughts on real estate—the lay of the land as we embark on 2020 and what you can expect in the coming months. For instance, did you know that building energy causes 73% of the pollution that contributes to climate change? As a result, the City of Minneapolis declared a Climate Emergency in December. From this, Kate Damato predicts that developers and contractors will increase their efforts to construct buildings with climate sustainability in mind.
Here’s what else you need to know as we dive in to 2020:
Throughout the Twin Cities
While we work with clients all over the country, with roots in the Twin Cities, we start our predictions here.
Ericka Miller predicts that commercial real estate in the Twin Cities will remain in demand by investors, especially industrial and multi-family properties.
As Kate also states, “Multi-family will continue to be a hot market in the Twin Cities with coastal investors interested in the Twin Cities as an attractive secondary market. However, with increasing regulations from cities, increases in property taxes values, the smaller ‘Mom & Pop’ investors may be priced out of the market.”
Julie Kimble points out that the Twin Cities will “continue to benefit from a stable, diversified economy which will result in continued opportunities for smart development projects.”
Ericka agrees, noting that office rents will remain stable (though parking in the CBD and North Loop will remain a struggle).
On a national level
According to the Department of Labor, the US economy had 7.6 million unfilled jobs (with only 6.5 million people looking for work) as of last January according to Forbes. As the trend continues into 2020, this will have effects on real estate. As Julie points out, “Labor shortages will impact economic growth” and although multi-family development is in high demand in the Twin Cities, “it will stall in those communities with inclusionary policies until sources of funding are resolved.”
Ericka also notes that there will likely be “lots of uncertainty with the upcoming election, affecting market conditions producing a wait-and-see on long-term decisions by corporate end users.”
Technology to note
In an increasingly digital world, Kate reminds us that an increase in technology will continue at the commercial real estate level to manage and communicate data. Likewise, building data, tenant experience user interfaces and apps will continue to make appearances in 2020.
Let us know what you think; we’d love to hear your predictions for 2020 as well. Connect with us at KimbleConsult.com or following along as we sprinkle in our thoughts throughout the year on Facebook and LinkedIn.
Let’s make the best of the new year!