When investing in commercial real estate, there’s plenty of opportunity to generate substantial revenue—as long as your investment is properly planned. Commercial real estate development, particularly when investing in a volatile market, is a risky endeavor. Competent investors know that if your investment isn’t well-researched, your money, time, and potentially valuable development opportunities will be wasted.
Understanding how to evaluate a commercial real estate investment is essential for any investor. By studying past trends in the market, and analyzing estimated trends for the future, you’ll be able to confidently evaluate which cities are the most viable for your real estate investment, and develop the most successful masterplan for your project.
This article will look at six major domestic hotspots for commercial real estate, and will explore what makes these locations so profitable:
1. New York, New York
2. Miami, Florida
3. Dallas, Texas
4. Charlotte, North Carolina
5. Denver, Colorado
6. Atlanta, GA
Conducting the proper research is the first step in ensuring you’re making the right investment. From there, you’ll be able to find the right lender to finance your development—one with a proven track record of success, like Silver Arch Capital Partners. Read on to learn more about the hottest markets for commercial real estate.
New York, New York
It’s no surprise that bustling metropolitan areas like New York and its neighboring areas are commercial real estate hotbeds. The NY metro area has been, and continues to be, one of the world’s most active real estate markets. NYC ranks just behind San Francisco in terms of cost per square foot, and opportunities for commercial real estate developments remain fruitful throughout all of the five boroughs. NJ-based private lender, Silver Arch Capital Partners, boasts a high success rate in the big city, financing five successful commercial real estate bridge loans. Most recently, Silver Arch Capital Partners closed a $30.4 million loan, completing an acquisition to rebrand a property in Midtown into the Cachet Boutique New York Hotel. This is just one of the many examples which highlight New York as a lingering hotspot for commercial and multifamily real estate development.
Miami, Florida
Miami has become increasingly more prominent in recent years as a destination with bustling commercial development. As Miami and nearby neighborhoods spike in population—the most recent census reporting a 470,900 head count within the city alone—investors’ interests have peaked at the growing opportunities for industrial and multifamily development. The rising population has called for the necessity of new residential areas, as well as new businesses for a growing customer base.
Silver Arch Capital Partners, as an example, recently closed a loan of $21 million in Miami, re-introducing Florida’s famed ‘Jockey Club’ site as a hot destination development. As new supply continues to trickle into the Miami-Dade industrial market, maintaining a strong leasing activity at almost 2 million square feet, the Floridian city remains a major hotspot for commercial real estate investment.
Dallas, Texas
According to the most recent US Census Bureau, this city’s population has gained more new residents in recent years than any other metropolitan area in the States. And, the Dallas-Fort Worth region is only expected to grow, projected to overtake Chicago in becoming the world’s third-largest metropolitan area. As with Miami, the rising population keeps possible investors and developers busy with abundant new, and promising, commercial real estate opportunities. With new residents come new jobs—meaning new possibilities for residential and industrial developments. Its population on the rise, investors should keep Dallas on their radar while investigating commercial investment opportunities.
Charlotte, North Carolina
As of late, this city has become notorious as the nation’s top tech powerhouse, ranking first on the most recent CompTIA Tech Town Index. Charlotte has earned its reputation as a hub for financial services, energy, and healthcare. As the city grows as a technology giant, attractive opportunities surface for commercial real estate investments. As of now, Charlotte homes tenants as high-profile as Duke Energy and Web.com—And after Cambridge Corporate Center sold in 2018 for $63 million, investors became more interested in potential office space development opportunities in the Charlotte suburbs.
Denver, Colorado
Ranking among the top five in CBRE’s 2019 Investors Intentions Survey, Denver has quickly advanced as one of the most appealing locations for commercial real estate investors. The survey found that Denver’s commercial real estate investment sales rose to $12.5 billion over the last year, marking a 6 percent increase—and their investor activity isn’t projected to slow down. Home to the River North Arts District and a burgeoning arts community, Denver continues to be a hotspot for commercial real estate investments.
Atlanta, GA
Atlanta is home to one of the world’s busiest airports, making it a magnetizing destination for tourists and new residents. With a heavy stream of young workers flowing into the metropolitan, Atlanta’s commercial real estate has been expanding and reshaping for a millennial workforce. Not only is it expanding, but it’s expanding quickly— and is forecasted to swell to a whopping 8.6 million by 2050. Plus, with its bustling art community and its thriving activity as a hub for the movie industry, Atlanta holds promising opportunities for commercial real estate investors.
At the end of the day
Big metropolitan areas, like New York, LA, and Boston, have historically demonstrated success as locations for commercial real estate development. Cities have more stability, and are traditionally safer, than more rural areas—and those evaluations hold true for the cities listed in this article.
However, investing in commercial real estate is risky in any location. Doing meticulous market research, and choosing the right lender to finance your project, is vital in ensuring a successful investment. Private lenders, like Silver Arch Capital Partners, offer opportunities that traditional lenders, in such a volatile and risk-averse world, would not be willing to take. Delivering commercial real estate bridge loans which range from $1 million to $70 million, Silver Arch Capital Partners has a proven record which can allow you to invest with more confidence. Do your research, explore your financing options, and move forward intelligently. At the end of the day, it’s your time, your money, and your vision.
