The pandemic dominated the previous year, resulting in new restrictions and unfavorable risks. Nevertheless, commercial real estate is still heading into 2022 with hope.
According to the EMEA Real Estate Market Outlook 2022, numerous European markets enhance their level of vaccine implementation and leasing performance, making signs of pre-pandemic sales.
For investors, trends and opportunities are equally important against the impact of the pandemic. Being systematic and ready in the real estate market is a huge factor.
Inflation
Despite the challenging time of the pandemic, job growth remains lucrative. Therefore, wage growth remains strong as well. In 2021, the wage growth acquired an average of 6.2%, while the Consumer Price Index soared 7% globally and the Producer Price Index grew 9.7%. In January 2022, the Eurozone inflation achieved a record level of 5.1% after years of low inflation.
Wage growth is likely to be the constant inflation factor and projects to calm down to about 3% by the Wall Street Journal Economic Forecast Survey around the end of 2022.
Quantitative Analysis
Further quantitative firms will play a role in commercial real estate in 2021 as it focuses on utilizing machine learning and AI in the investments. It is used to support investment decisions and guide investment opportunities.
Firms are searching for opportunities such as historical growth, identifying a property if it is a good idea to buy or sell, determining if the assets are overpriced or underpriced, and other comprehensive calculations.
This 2022, many quants anticipate entering the real estate market for unique tax advantages, outsized returns, hedges against volatility, and stable yield. Ultimately, nurturing a network of reliable partners is a significant advantage in retaining the high value.
Population and Migration
The population growth and population movements impact the housing market in which the higher population density raises the demand for local real estate.
In Germany and the U.S, the population remains stagnant due to Millennials being unhurried to start a family and the lowest immigration levels from 2011 onwards, leading to the real estate trend down.
Furthermore, the movement of population or immigration from one area of the country to another can predict the time to sell the property.
On the other hand, the areas with high population growth have a higher opportunity to open new facilities that help the business owners and commercial real estate around the country.
Industrial and Retail Property Type
Industrial property has become one of the magnets for investors and a firm favorite since it provides long-term opportunities for income with rent growth and absorption. The hype of online shopping, distribution facilities, and warehouses is highly in-demand for business transactions nowadays.
Moreover, investing in industrial real estate produces higher yields and net leases.
Meanwhile, retail property is neutrally a good investment. The excellent appreciation value, more tenants to occupy, the leveraging increases cash flow, security advantage, and higher potential income are visible.
Dominate Optimism
The commercial real estate (CRE) industry is facing 2022 with optimism and development. The noticeable recovery and the complementing productivity of every office employer and the evolving industry are increasing.
Regardless of financial circumstances, 80% of real estate respondents anticipate higher and better revenue this 2022.
Sustainability
Having a solid partnership and a vast network of connections that develops long-term objectives offers new opportunities and organizational arrangements. They play a big part in the real estate industry’s success.
Many CRE companies address sustainability concerns, climate risks, social issues, and diversity early to prioritize and take initiatives to create a better environment, economy, and society.
Amir Dayan: Defying the Odds
As mentioned, the economic crisis caused by the global pandemic significantly impacts everyone, and the real estate industry is not an exemption.
Amidst the catastrophe, Amir Dayan, the owner of Lianeo Real Estate, an established and significant German real estate company, closed a deal in Eschborn, Germany. He also completed contracts with Frankfurt, Hanover, Dusseldorf, Germany, and in different places in the Netherlands, the United Kingdom, and Europe.
Mr. Amir Dayan was born in Tel Aviv in 1974 and is currently a shareholder and investor in various private and public real estate projects. He is an Israeli entrepreneur who operates not only real estate projects but also many European hotel businesses.
Amir Dayan and his family are the beneficial owners of several companies, like Ouram S.a.r.l, Vivion S.a.r.l, and Golden capital.
Amir Dayan is a real estate professional and has in-depth knowledge about commercial real estate. No wonder he successfully thrived in this pandemic.