Grand Rapids, MI (April 19, 2022) – Advantage Commercial Real Estate Services announces the release of their Q1 Market Trends Report that details the initial trends their commercial real estate experts saw in the first three months of 2022.
Inflation, labor shortages, the uptick in interest rates and general uncertainty of what lies ahead are topics dominating the conversation. The initial labor challenges and rise in inflation appeared to be a short-term result of the pandemic, however both quickly turned into trends potentially forecasted to last a few years. The rapid decline of the workforce is having a significant impact on the communities we live in, as well as each sector of commercial real estate. Inflation will keep climbing as labor costs increase, driving up the costs of goods and services for both businesses and consumers. Experts are saying the labor market will continue to tighten and rapid wage growth will fuel the inflation we are already seeing.
Despite these challenges, West Michigan remains resilient and the region is coping well compared to other cities. The Advantage Commercial Real Estate advisors are optimistic as demand is higher than ever and national corporations have a growing desire to be here.
INDUSTRIAL
- Demand for warehouse, distribution and fulfillment centers is still at an all-time high in West Michigan, with quite possibly the lowest amount of available inventory the market has ever experienced.
- Although the industrial market has been healthy, manufacturers are being more strategic as they continue production in a very different environment than usual.
OFFICE
- Now more than ever, business leaders need to adapt to flexibility in all areas of their business. Although labor shortages are not directly impacting this specialty, businesses are treading carefully with their employees when it comes to returning to the office.
- Privacy within the office will be a major factor for employers to consider this year.
- The good news is that the office market is still active and growing. If businesses can creatively meet the demands of employees, the office market should remain relatively stable.
RETAIL
- Retailers and restaurants are finding it nearly impossible to hire employees. The lack of labor we are seeing across the country and in our local market is directly impacting many franchisee’s growth plans.
- Retailers are being forced to get creative to attract employees to their stores, as the desire for more money and flexibility are top priority for applicants.
- Contrary to public perception, the retail market is healthy and growing. Demand is high in every sector of retail, including the restaurant industry. We expect this to continue as national retailers have their eyes on West Michigan.
INVESTMENT
- Although investors are still finding opportunities, the investment market has become difficult to navigate. Interest rates have risen, and meaningful rate increases will continue, creating quite a bit of uncertainty for the investment sector.
- Investors and corporations have more capital now than ever before. This excess capital has allowed investors to buy more, creating a tighter investment market overall.
- West Michigan has a conservative undercurrent that insulates us from significant volatility. Coupled with a diverse ecosystem of industries and steady growth, investors remain bullish on West Michigan’s long-term growth.
The full Advantage Commercial Real Estate First Quarter Market Trend Report can be found here.
For media interview requests, including advisors to share regular updates on commercial real estate industry trends, contact Callie Simon at Callie.Simon@AdvantageCRE.com. To learn more about Advantage Commercial Real Estate Services LLC, visit AdvantageCRE.com. ###
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