What’s Ahead for CRE in 2021 by Kevin Sanz, CCIM, MSIRE

Posted on March 31, 2021

The continued rollout of vaccinations across the U.S. provides a beacon of hope that consumers and businesses may begin returning to many of their pre-COVID-19 routines and a post-pandemic economic recovery is possible. Looking at the commercial real estate landscape, things are quite different today than they were one year ago before government-mandated business closure.

As businesses continue to look for ways to free up cash flow and deploy capital where it is most needed, we expect the volume of sale leaseback activity to remain strong throughout the new year. These transactions allow businesses to unlock 100 percent of the value of their corporate-owned real estate while providing investors with tax benefits and passive income over lease terms that typically exceeds 20 years. We also expect a continuation of the pandemic-spurred exodus from dense urban metropolises to more spacious and affordable suburbs and secondary markets. However, because neither businesses nor consumers are willing to give up the conveniences of city living for larger space in the suburbs, we expect that outparcels and other easy-adaptable properties will remain in demand. We are already seeing significant activity from credit-quality tenants competing to fill these spaces and establish themselves in prime geographic locations with longer-term triple net leases.

With offices in Miami, Orlando, New York City and Geneva, the team at Orion works with investors, developers, property owners and brokers through all phases of real estate transactions, from strategic planning and analysis to financing, negotiation, property management and disposition. For more information, call (305) 278-8400 or email info@orionmiami.com.