Category: Insights

Luke Hamagiwa serves as the market leader responsible for carrying out investment objectives throughout the Mid-Atlantic and Northeastern United States on behalf of KBS REIT, pension fund and sovereign wealth fund clients. Within these markets, he is responsible for the execution of strategic business plans for each of the assets within his portfolio along with new acquisition opportunities and joint-venture partnerships.

Owners and investors in Commercial Real Estate (CRE) are working to attract employees back to the office while contending with trends such as hybrid work, competitors who offer work-from-home options, and the Great Resignation. At the same time, employees are hyperaware of their surroundings — with health and safety top of mind.

There’s no denying that workforce dynamics have spurred workplace transformation and the changing nature of work necessitated by the COVID-19 pandemic. Companies that might have never entertained remote work managed to shift their entire workforce to working from home within days in many cases.

With more than 38 million workers voluntarily quitting their jobs, 2021 was dubbed the year of the “Great Resignation” and “the Big Quit,” and the “Great Retirement.”

While COVID-19 variables may cast doubt on office work alternatives, values point to many strong returns.

After a bumpy 22 months, optimism may be making a comeback within the retail space. Last year, brands were still in a state of survival witnessed by a seismic swing in eCommerce, changing consumer behavior, and challenged supply chains.

For the multifamily housing industry, 2022 is here. Along with the new year, there’s a hope for better times as well as a need to clean-up unfinished business.

What will happen to commercial real estate in 2022? It’s a trillion-dollar question, but the trends that seemed assured and certain just a few months ago are now in flux.

Now may be the ideal time to consider adaptive reuse to convert commercial property to residential or repurposed for a different commercial use.

The pandemic has brought a myriad of changes, much of which will have a permanent impression on commercial real estate (CRE). One of the most notable is the shift in consumer behavior and the impact on the environment around us.

Texas is the trifecta state, a place with warm weather, a zero-percent state income tax and inexpensive housing. But the “Lone Star State” is more than that: it’s also a major office hub centrally located in the U.S., with Dallas anchoring the Dallas-Fort Worth (DFW) metro area — where many of the Nation’s largest tech centers are located.

Industrial Real Estate is currently the best performing commercial real estate (CRE) asset type, touting 44 consecutive quarters of positive net absorption. That’s according to recent forecasts, research articles, reports, and other data and analysis presented over the past couple of months. This spotlights an intriguing success story amid a pandemic that crippled so many businesses and industries.

Millions of Americans move each year, but in the post-pandemic era something has changed: the workplace has evolved, and with change there are now new opportunities for both organizations and employees. One result is that people are in motion, moving from one metro area to another, often in search of a better work-life balance. In fact, Redfin reports that in the second quarter more than 30 percent of its website users searched in different metro areas.

Remember when cubicles were all the rage? Office tenant preferences have changed over the years. Today, tenant satisfaction has been redefined as a result of the COVID-19 pandemic and dramatic changes in the labor market.

Like most of the commercial real estate (CRE) market, office came under pressure in 2020. Responding to local shelter-in-place health orders, up to 70% of the U.S. workforce was working from home (WFH) in April 2020, transforming once-bustling office buildings into ghost towns. That percentage has decreased to 56% since the beginning of the year, signaling a recovery is underway. The extent of that recovery and what it means for office real estate is still unknown, but there is some speculation.