The commercial real estate industry, including apartments, office buildings, industrial complexes and retail spaces, took a hit after the residential housing bust. And, when it did, it surpassed residential real estate as the worst-performing property class in 2009.
Now, the construction sector is playing catch-up. Multifamily building has nearly doubled from its low, and office construction is up nearly 55 percent from the trough. Cranes and scaffolding are filling many an area’s skyline.
Now that commercial real estate is on more solid footing, it’s time to make a few predictions. Here are what some key players in the commercial real estate industry are saying as they look into their crystal balls showing the commercial space roughly 25 years from now:
- The shopping mall will be dead. Due to the rise of e-commerce, only the strongest stores will survive. Developers will be looking to repurpose shopping malls into different types of spaces.
- As Baby Boomers reach the age of 75, the senior housing demand will skyrocket.
- Urbanization will continue to grow, giving a boost to multifamily residential complexes.
- Suburbs won’t die, but they will continue to become more like urban centers.
- Office spaces will become more like today’s tech company campuses, including open spaces, digital workspaces and unique amenities.
- Buildings will become “smart,” so property managers will need help to run them like high-tech jobs.
- In 25 years, all commercial buildings will need to be up to the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) standards, and those standards will continue to evolve.
Editor’s note: This article was originally published in August 2015 and has been updated.