- jerry woods
What real estate attorney's think about the future of commercial and development markets
A real estate survey by Bloomberg Law is predicting big defaults in retail and hospitality properties in 2022. According to a 2021 Commercial Real Estate Bankruptcy Survey, 94% percent of the respondents picked retail as one of the top three property types at risk of default. While in the same survey, hospitality was the choice of 79% of those surveyed and an equal percentage also picked office to round out the top three.
Multifamily was a top-three pick of only 28% of respondents, while very few real estate attorneys selected industrial or healthcare as among segments likely to be in the top three property types for default (6% and 5%, respectively).
“Cancellation of office leases and potential vacancies caused by permanent moves to remote work might be behind this choice," according to Bloomberg Law. For developers, this may be an opportunity to pick up large repurpose properties. For many developers and investors, you should start thinking about what you could do with old box retail, old hotels, and even old multifamily units that may be coming to the market for sale.
According to industry experts, cities are going to be under enormous pressure going forward. Because of the work from home revolution and the change in consumer buying behavior, developers should be ready to take advantage of coming deals in 2022 and 2023.
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