The Top Issues Facing Commercial Real Estate

Commercial real estate faces several challenges that may make it difficult for business owners to lease space. Today’s commercial real estate market faces several challenges that may make it difficult for business owners to lease space. The industry faces several challenges due to changing consumer behavior, technology, and tax laws, the industry faces several challenges. It is difficult for business owners to predict if this is a temporary or long-term problem, so they need to take action now to prepare their business for the future.

Public and Private Indebtedness

The commercial real estate market is experiencing record levels of indebtedness. The main driver for this trend is increasing commercial real estate borrowing by investors. While this trend is suitable for a short-term boost to property values, it is also a significant risk for the commercial real estate market. Suppose the rate of debt growth slows or is disrupted by changing economic conditions. It could lead to a considerable slowdown or even a complete crash in the commercial real estate market.

The Rise of Technology and workflow

Technology is changing the way the commercial real estate industry operates. The modern office must be equipped with the latest technology. Business owners can lease space in a building without worrying about this. The same is true for common areas such as lobbies, hallways, and parking lots.

Office space not equipped with the latest technology may struggle to attract and keep the best employees. As a result, they may face fewer prospects for lease renewals. This could lead to problems if the lease terms are not renegotiated before the term ends. It could also mean that the business will struggle to grow if it cannot hire additional employees.

Infrastructure

Infrastructure is a significant challenge in the commercial real estate market. Many buildings were constructed during the boom years of the 2000s. Many of these buildings are now at the end of their lease terms and are no longer occupied.

Economic Renewal

Economic renewal is a growing trend in the commercial real estate market. Many businesses are expanding into new locations and remodeling their existing buildings. Commercial real estate owners find this is an excellent opportunity to attract and retain clients.

However, they are facing several challenges. These include rising construction and operating costs, scarce construction labor, and increased competition for project development.

About Erich Merkner

Erich Merkner was born and raised in Indiana, and has had an interest in commercial, residential, and industrial construction for as long as he can remember. After completing his carpentry apprenticeship at the local 599 Indiana Kentucky Ohio Regional Council of Carpenters (IKORCC), Erich went on to continue his education at the Ivy Tech Community College, wherein he graduated with an Associate's Degree in Applied Science, where he majored in Construction. He's been certified by the U.S. Department of Labor, and has been in the trade for quite some time.

Erich Merkner has also found a home in Real Estate in addition to his love of Construction. He immediately began purchasing and investing in big properties, but quickly switched his focus in Real Estate to assess and work with the gap in the market regarding Green Initiatives. This is where Erich learned that he can invest in and construct incredibly eco-friendly households that are a better quality, rather than purchasing a new house. Erich jumped into the prospect of renovation and rehabbing a new house, thanks to his extensive background in carpentry. His main goal is to get a house to a 100% energy-efficient rating by combining and harnessing different energy sources in the home. This, in turn, saves people more money and hopefully generates an energy surplus. Erich is passionate about sustainable living, and constantly promotes the idea that electric ccompanies should compensate consumers to adding to the energy grid.