Top Trends in Commercial Real Estate 2018

March 29, 2018


It’s a new year which means new times for commercial real estate. After the turbulent tour of 2017 (remember the costly coastal natural disasters?), this year is promising a relatively smooth ride for the industry.


Technology will be the star as developers and investors focus on fulfilling the demands of a world crazed with e-commerce. Preferred office spaces are keeping up with smart office capabilities and tech features. Even the real estate industry itself might find this to be the year to click the update button and take on the implementation of advanced automation systems.




It’s no secret that e-commerce continues to grow as the modern method of consumption in the new year. The internet has changed the way we shop after all. As long as consumers continue to click, companies will search for better methods to get the goods to their front steps. Put simply, brick-and-mortars are slowly losing their spot in retail, leaving a growing number of empty storefronts on the real estate market.


Last year the retail sector took quite a hit as roughly 8,000 stores around the country closed their doors. Although the year ahead provides a softer outlook, many project investors question the vitality of the industry as it is predicted that many will hop on a train heading in a different direction.


The outlook may be better, but the bottom line is many major retail chains have announced major store closings within the first two weeks of 2018–not a strong start. This includes 64 K-marts and 38 Sears locations, along with 11 Macy’s department stores and approximately 200 Toys R Us locations.




The concern for companies will continue to be the need for more industrial space. Industrial buildings are designed to meet the challenges of e-commerce –delivering orders and managing returns, especially with the consumer expectation for that “2-day free shipping if you spend $50 and order in the next ten minutes” deal promised at checkout.


Retailers are configuring their supply chains to accommodate shifts in consumer behavior. The solution? Warehouses. Companies realize they need larger, more sophisticated storage and distribution centers to meet customer demand and increase sustainability. As a result, more and more companies have scooped up these spacious buildings for their fulfillment facilities. The demand may cool in the coming years after companies transform their businesses to accommodate, but this year industrial properties will remain hot in the real estate sector.




Although down from its peak in 2015, the job market is thriving and developers are tailoring office spaces to the evolving workplace trends. From flexibility and green design to the technology needed to make the office “smart,” those who focus on what is in vogue for the office (and we aren’t talking this season’s tailored trousers) will see the greatest benefits on the market in 2018.


Technology has found a place in every sector of the economy and productivity has put more pressure on office workers, and offices, to perform. Offices suited to these trends will continue to be profitable investments.




There’s a lot of buzz about keeping up with the newest technology in the commercial real estate market. Topics of e-commerce and smart offices are prevailing in the real estate conversation these days. But why is it so surprising that, in some cases, the real estate industry itself has been slow to incorporate new technologies within its own industry?


The real estate industry had been known to be a relatively late adopter of technology. Lease documents and tax information, for example, are kept as physical copies. Spreadsheets are used to record and analyze data. A lot of time and manual labor is used to retrieve and transfer information.


But 2018 seems to be the year for change. Advanced automation and robotic process automation (RPA) will decrease the high level of human involvement, curbing chances of fraud and error. This first requires a shift in mindset for the industry but embracing these advancements help real estate companies reap the benefits of these new tools and approaches.


All dimensions of the real estate market are changing at rapid speeds. Technology is the common thread and keeping up to date is key to staying on point with 2018 commercial real estate trends.