Industrial Real Estate: A Normal Market for a Somewhat Normal Time

Recently coming off the effects of nearly two years of rising interest rates by the Federal Reserve, the real estate market has been in a state of constant change for the past 18 months. As this blog has extensively discussed, real estate is very dependent on interest rates, as they influence property loans, cap rates and ultimately, property prices. Despite the recent period of adjustment, the economy seem to show signs of normalization, with mortgage rates, consumer loan rates and even treasury rates settling at levels much higher than those of the previous two years. By all indicators, it seems like our economy and we seem headed for a soft landing. No market has internalized the current state of the economy more than the Industrial Real Estate market.

Unlocking Retirement Wealth: A Senior’s Blueprint to House Flipping Success

By Sharon Wagner

Please enjoy this article from guest author, Sharon Wagner. TRET will return next month with another article continuing its series on property types.

Navigating the world of house flipping can be an exciting and profitable journey for seniors who are seeking an active and rewarding retirement. While the venture promises lucrative gains, it also calls for strategic planning, unwavering dedication, and tactical execution.

The following are indispensable guidelines aimed at assisting mature adults in carving out a successful career in the house-flipping arena, while also enjoying a balanced lifestyle. The Real Estate Think Tank explores these crucial facets in detail.

Retail Real Estate Is Thriving, But How?

Picture it, the year is 2023. Any and every item that can be bought sold can be accesses via the Internet from the comfort of one’s own home. For over seven years, the number of stores in existence has steadily declined. The economy is experiencing the perfect storm of rampant inflation and recessionary forces. Despite all of this, retail real estate vacancy nationwide is 5.4% and retail is thriving. Let’s take a look at why.

Is the American Office Market Dead?

There was a time in the not too distant past when I considered office properties “the best of all worlds.” They offered the flexibility to create leases that were in between the detailed relationships established by industrial and retail properties and the more straight-forward residential lease. Rental calculations were relatively simple—base rent plus utilities and any tenant improvement allowances. Occasionally, common area improvements or maintenance factored into the equation. The property was typically used from 7 am until 7 pm, so utilities were relatively low and predictable. Wear and tear on the property was much less than any other real estate property class.

The necessity of office space was at one point unquestioned and tenants were readily available. Space considerations were for the most part limited to whether the location was large enough and had enough amenities or services to meet the tenants needs. Leases were easy to enter, easy to renew and easy to understand. For owners, office properties offered many of the benefits of owning a commercial property with fewer of the complexities that come with other property types.

The Connection Between Banking and Real Estate in 2023

Throughout the years that I have written this blog, I have regularly connected the activity of the financial market with the real estate market. In doing so, I often take for granted the connection between the two markets. Recent troubles in local banking, however, give me yet another occasion to highlight how the banking industry impacts the real estate market. It seems like every few years, I write an article like this, but I will do my best to highlight the contextual factors that make this year’s bank failures unique.

Real Estate Is Power

Lost in all the talk about real estate markets and real estate wealth generation is one key fact—real estate ownership is one of the surest ways to consolidate influence and power. If you don’t think this is true, simply look up the largest land owners in each major US city and follow the trail of their political contributions and donations. Large land owners can exert a tremendous amount of influence on neighborhoods and local laws. One very public example of this is Dan Gilbert, whose mortgage and real estate empire influences the entire Midwest, but also Detroit and Cleveland in particular. Even former president Trump, who has a less than stellar reputation in the New York real estate market, was able to parlay a real estate empire into a presidency.

Discipline and the Down Payment: Using Your Superpower To Get Paid!

Real estate is about asset and cashflow management. Put more simply, it’s about managing what you have. The right purchase exchanges your resources, in the form of cash, into a property, contract, tax lien, note or some other real estate asset. Once you have obtained a property, decisions have to be made regarding its repair, management and sale, if that is your plan. No matter where you are in the process—purchasing, managing, or selling, discipline is key.

One of the most controllable aspects of our lives is our behavior. How we act and respond to the world shapes our present and our future. Our ability to act in a way that brings about our desired outcomes is uniquely ours and belongs to no one else. In that way, discipline is our superpower.