Biz Journals - Brent Godwin - 17 April 2018
The shifting retail atmosphere is one of several factors weighing on commercial real estate prices nationwide, according to a recent report.
Business Insider reports that the Green Street Commercial Property Price Index, known as CPPI, has decreased more than 2 percent from March of 2017. The decline means an overall eight-year increase has begun to turn down.
However, the state of CRE nationwide is much more complex than the index can show.
The retail sub-index was one of the hardest hit spots, as e-commerce and shifting consumer preferences continue to take a toll on certain retail real estate. It's no secret that some strip malls and large shopping malls have been hit hard by closing big box stores and the ease of online shopping. Although retail experts say the U.S. is expected to again open more new retail stores than close this year.
As retail shifts, it spells good news for industrial properties, which are up 11 percent from one year ago. Warehouses, fulfillment centers and others are surging right now as e-commerce business looks to fill out its supply chain.
Birmingham's industrial real estate is indeed seeing an uptick – a trend we've recently noted.
You can read more, including what the index shows for multifamily, lodging, and office, here.