Apr 01, 2021 - 0 Comments - Analysis, Office Property, Opportunity Zones -

Video: GSU’s Jon Wiley, PhD and Lynn Mckee on Opportunity Zones and the Office Market

The Conversation: Understanding the Current Landscape of Commercial Real Estate & Opportunity Zones; Insights from Experts

In the ever-evolving world of commercial real estate, navigating the complexities of market trends, investment opportunities, and shifting dynamics requires a keen understanding of various factors at play. Recently, on America’s Commercial Real Estate Show, experts Jon Wiley, PhD, Professor at J. Mack Robinson School of Business at Georgia State University, and Lynn Mckee, Lecturing Professor at the J. Mack Robinson School or Business at Georgia State University and Senior Vice President and Commercial Real Estate Banker at SunTrust Bank, provided valuable insights into the current state of commercial real estate and shed light on topics ranging from Opportunity Zones to the future of office space. The discussion is about property throughout the United States, thus some observations may not apply or may apply less to Miami commercial real estate. Investors interested in Miami area Opportunity zones may be interested in our post with an interactive map of Miami-Dade’s 67 Opportunity Zones. Discussed are effects on opportunity zone values; they note buyers seem best served to concentrate on areas that already have an upward trajectory. They also go on to discuss office properties and what the post-COVID future may be for them, declaring their belief that reality will turn out not to be the best case or worst case scenario, but somewhere in between. These are analytic types that are clearly looking for answers in the data but also are trying to get ahead of the data given that the situation is currently so fluid.

Opportunity Zones: Debunking Myths and Unveiling Realities

Jon Wiley, a financial economist, delved into the often-misunderstood realm of Opportunity Zones. Contrary to popular belief, the data suggests a more nuanced picture than a mere influx of capital into designated areas. Through rigorous analysis of industrial property transactions, Wiley uncovered that properties within Opportunity Zones experienced a 25% increase in value compared to non-Opportunity Zone properties. However, this increase is not uniform across all properties. Those with larger land sizes and lower coverage ratios witnessed the most significant premiums. Moreover, the success of Opportunity Zones hinges on underlying market trajectories, with areas experiencing positive employment and population growth reaping the most benefits.

The Office Space Conundrum: Balancing Remote Work with In-Person Collaboration

Transitioning to the topic of office space, Lynn McKee provided insights into the ongoing debate surrounding the future of office demand. As the pandemic reshaped work dynamics, businesses grappled with the optimal balance between remote work and in-person collaboration. McKee highlighted a fundamental shift in office space utilization, where the demand for flexibility and safety emerges as paramount considerations. While remote work offers convenience, it also poses challenges in fostering company culture, collaboration, and onboarding new employees. Additionally, the office space paradigm is evolving, with the emergence of hub-and-spoke models and a greater emphasis on healthy building standards.

Embracing Education and Adaptability in Commercial Real Estate

Both McKee and Wiley underscored the importance of education in navigating the nuances of commercial real estate. They emphasized the need for professionals to continuously enhance their knowledge and adaptability to thrive in an ever-changing landscape. McKee highlighted Georgia State University’s program, which caters to a diverse range of students, including mid-career professionals seeking to deepen their understanding of the industry. Wiley echoed this sentiment, advocating for a more sophisticated approach to real estate investment and management.

Looking Ahead: Navigating Uncertainty with Strategic Insights

As commercial real estate continues to evolve, strategic insights and informed decision-making are essential for investors, developers, and industry professionals alike. The conversation on America’s Commercial Real Estate Show provided a glimpse into the multifaceted nature of the industry, offering valuable perspectives on Opportunity Zones, office space dynamics, and the importance of education. By staying abreast of market trends and embracing adaptability, stakeholders can position themselves for success in an ever-changing landscape.