16A —January 21 - February 17, 2022 — 2022 Forecast — M id A tlantic Real Estate Journal
www.marej.com
2022 F orecast
Office demand still uncertain Forecast for 2022: Continued demand, growth for warehouses and vacant, industrial land
G
ood news is in rather short supply these days. In fact, I’ve actu -
demand and overall growth. I’m basing this projection on what I’ve learned during my
of success. Following are de - tails on what I expect for the coming year.
warehouse distribution will continue to be extremely desir - able. And, because lease rates remain at an all-time high, most privately held companies – despite a historical inclina - tion to lease warehouses – will keep trying to purchase space. These companies have become increasingly savvy during extended searches – some of which have been ongoing since 2019 – and their eagerness to close a deal is driving prices higher. As for land transactions, I anticipate we’ll see deals no one would even have imagined
as recently as five years ago. Certainly, companies will still be purchasing land for the specific purpose of construc - tion, but we’ll also see vacant land in select markets being acquired for prices nearly on par with what it would cost if completed structures stood on the same site. These parcels of land will be used primarily for tractor trailer parking, storage both for shipping containers and fleet vehicles for last mile distribution, and also to ac - commodate the specific needs of builders, contractors, and equipment vendors. Office If you happen to lease corpo - rate offices and are currently sitting on multiple locations that each are larger than 50,000 s/f … well, there’s definitely going to be some uncertainty during 2022. But, I also project some entrepre - neurs will negotiate attrac - tive lease terms by astutely and creatively navigating the complex “what ifs” related to the ongoing pandemic. To put it more succinctly, 2022 can be an excellent year for signing a favorable lease deal. Lease Security Even before the pandemic, we were dealing with compa - nies that had enjoyed rapid sales growth – often via ecom - merce – but had neither the history nor balance sheet to justify a move to a larger warehouse or office space. In these cases, landlords were typically faced having to de - cide whether to a) request a larger security deposit or b) simply accept the conventional two months net rent and then hope the new tenant wasn’t some “fly by night” Internet sensation. Now, with COVID- related considerations added to this mix for 2022, landlords and tenants will need to work even harder to identify ways to make both parties feel less vulnerable as they enter into leasing agreements. So … how sure am I about all this? Well, I’d never rec - ommend that anyone bet the proverbial ranch on my real estate projections, but I am strongly confident about 2022. This year will represent a dis - tinct improvement over 2021, and I’m certainly excited about managing some exceptional transactions for my clients. Jonathan Glick is execu- tive vice presidentat at SheldonGross Realty. MAREJ
ally become rather skit - t i sh about reading the daily head - l ines , s im - ply because I’d prefer to side-step all the negativity.
This year will represent a distinct improvement over 2021, and I’m certainly excited about managing some exceptional transactions for my clients.
decades of commercial real estate experience, as well as the expert input of my profes - sional colleagues at Sheldon Gross Realty. We all are bull - ish on 2022 and are looking forward to an expanded level
Industrial We should continue seeing unprecedented demand for all types of industrial prop - erties, including warehouse distribution, manufacturing, and unimproved land. In 2022,
Jonathan Glick
This said, I’m happy to peer into 2022 and share with you some favorable projections. You see, it’s going to be a good year, both in terms of ongoing
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