The COVID-19 pandemic has resulted in a worldwide health and economic crisis. In the United States, that has driven many changes in our way of life. Yet, Americans are resilient, and the good news is that Americans believe in real estate and its long-term value. Further, the initial distribution of approved Coronavirus vaccines has reduced the existing uncertainty, stimulating optimism that better conditions for everyone will take place progressively and aspects of normalcy will resume in 2021.
The Overall Real Estate Outlook
The economic restraints from 2020 have resulted in many investors having solid access to capital and a real appetite to increase their holdings in 2021. That, combined with the expectation that interest rates will remain low in the near term, should stimulate renewed real estate investment activities this year.
The housing outlook remains strong, driven by remarkably low interest rates. Additionally, the apartment sector looks strong due to a macro-level housing inventory shortage.
Despite the health challenges faced by senior care facilities, the good news is that investors still have a relatively good outlook for seniors housing due to the continued aging of America and the need for good care facilities. Investors in this sector see seniors housing as a long-term investment, and future demand certainly looks positive.
The self-storage category also has demonstrated real estate investment popularity in the last few years and that is projected to continue.
Investors broadly are a bit more uncertain about the outlook for improving values in the retail, hospitality, and office space sectors. Clearly, the retail and hospitality areas have been hit hard by the restrictions resulting from COVID-19. Yet, those areas are so important to the American way of life that it is hard to see them restrained in the long-term.
The office sector may experience somewhat of a reset as companies seem to have found that remote working conditions can be functional, thereby requiring less physical space for team members. At the same time, there is a demonstrated need for culture and collaboration that isn’t well-fulfilled in remote work. And social distancing may require new layouts with more space for workstations.
Some Good News for Charleston, S.C. Real Estate in 2021
Charleston has long been an attractive and robust real estate market due to the many attractive features of the area, along with its strong economic drivers. Thus, the good news is that office construction and residential development are projected to continue to grow in 2021.
Industrial growth has continued to be strong and the demand for warehouse space has been remarkably strong in 2020 with logistics companies seeking large amounts of space as they participate in America’s surging role in the global supply chain.
Construction development is projected to continue in 2021 as evidenced by these projects:
- The Jasper is a 12-story mixed-use building coming to the Charleston historic district. It will contain Class AAA office space, 219 luxury rental homes and penthouses, plus dining and retail space.
- WestEdge is a 60-acre master-planned development situated along the Ashley River. It is expected to include apartments, office space, hotels and dining, retail space, and a new Publix grocery store.
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