Office Investors Now Looking To The Suburbs
March 28, 2018
Traditionally, the Central Business District (CBD) has been the place where businesses want to locate their offices. However, as suburbs are expanding their industrial and commercial real estate options, some business are finding the benefits of being just outside the CBD and are beginning to migrate there, finding flexibility in the suburbs that are not available to them within the CBD.
Below is an article from globest.com that provides statistics and predictions of the future and benefits of businesses moving to the suburbs. After reading the article, contact Caton Commercial so that we can help you find the best location for your offices, whether you want CBD or suburbs.
Source: globest.com | Re-Post Caton Commercial 3/28/2018 –
CHICAGO – The US office investment market did cool a bit in 2017, but that was only after a few years of record-setting investment in several metro areas. And a solid fourth quarter slowed down the rate of decline. Furthermore, US real estate remains near the top of many investors’ wish lists, and with 2018 shaping up to be a robust year for the office market, the next year should see a good number of trades. But in a search for higher yields, many investors have started looking past the top CBDs and set their sights on suburban properties.
US office sales volume in the fourth quarter was $36.2 billion, according to a recent report, up from $28.7 billion in the third quarter. However, a slight uptick in volume in the fourth quarter is not unusual as buyers and sellers seek to close transactions before the year-end. And total US office sales volume for 2017 was $131.9 billion, down by 8% over the year.
The report partly attributes the slight slowdown to a sharp decline in cross-border sales, particularly from China. Foreign investors typically stick with the safest investments, usually the best properties in the nation’s core CBDs. Perhaps it’s not surprising that in 2017 attention shifted away from the six major metros (Boston, Chicago, Los Angeles, Manhattan, San Francisco and Washington, DC) whose combined sales volume of $68.7 billion in 2017 was 15% below the 2016 total. Investment activity in secondary markets showed no change at $53.8 billion.