Saturday, June 17, 2017

Millennials, Offices, Retail, Hospitality


Millennials have surpassed baby boomers as the largest generation.  We are taking over the world.  Because of that, there are some CRE sectors that are changing.

Offices:
Millennials are glued to their phones, so we take our work with us everywhere, 7 days a week.  Working 9-5 in some cubicle isn't for us. We telecommute, face-time and conduct Skype meetings from home, the airport, cars and trains.  And if we have to come into the office, millennials demand bright open communal work spaces, preferably LEED certified, close to city hot spots and transportation.

WeWork is a business that offers shared office spaces around the country.  It was originally aimed at small startups and entrepreneurs who didn't need or couldn't afford a full-time office space.  Now large corporations are starting to book theses spaces on the demand of their younger workers because they are open, light-filled spaces that promote community and networking with other professionals.

Obviously, office space is in transition right now.  I feel that unless you're investing in class A office space as described above, then it's going to get harder to fill those offices in the future.

Hospitality:
The home-sharing website, Airbnb, has been killing it!  Over 60% of people who have booked on Airbnb are millennials.  Likewise, HomeAway is an online platform renting homes (no sharing) for any length of time.  Although there has been some talk that these services have taken a big bite out of the hotel/motel industry, Business Insider wrote a piece revealing that Airbnb has more rooms overall, but that hotels are still outperforming them.  Even so, the hotel industry sees Airbnb as an impending threat and is working to take them out.  The New York Times wrote an article detailing the hotel industry's actions.  The industry is upset that Airbnb has caused hotel room rates to drop during peak seasons, along with Airbnb not having to play by the same rules as hotels regarding tax, security and other regulations.

"Millennial hotels" is how the hotel industry is attracting young people.  These hotels typically have smaller rooms that are focused on technology, cool gathering spaces to meet like minded people and amenities like photo booths, vegan and gluten-free menus, on-site bike rentals, etc.

Retail:
It's no news that brick and mortar retail real estate isn't doing as well as other sectors, and investors are getting skittish.  Millennials have changed the landscape of retail.  Personally, I rarely go into a  brick and mortar store to buy anything but groceries.  The grocery anchored strip centers with nail and hair salons, maybe the dollar store or Goodwill and other quick neighborhood conveniences, seem to be doing fine, although recently it was revealed that Amazon bought Whole Foods. But, I buy all electronics, fashion, dog toys and food, contact lenses, and books online due to its convenience and the ability to quickly research competitive pricing.  Because of e-commerce, the industrial sector has benefited.  Large industrial distribution centers close to urban areas have seen very good absorption.

The downturn of traditional retail stores is the reflection of technologically savvy Millennials.  So one has to be careful when investing in retail.


4 comments:

  1. SpainForSale.Properties isan Exclusive Real Estate Agency offeringLuxurious Properties For Sale and Rentonthe Costa del Sol, such as: Luxury VILLAS FOR SALE IN LOS ARQUEROSSpainForSale.Properties is considered one of the most trusted Exclusive Real Estate Agencies in Marbella, Costa del Sol and other “Prime Locations” in Spain.Live onthe Costa del Sol and Enjoy a Luxuriouslifestyle in one of themostbeautiful places of the World.Luxury Properties For Sale in Prime locations of the Costa del Sol: Mijas, Marbella, Benahavis, Estepona ….
    #LuxuryRealEstateMarbella #LuxuryProperties #Investment #PropertySpecialist #Immobilienmakle #العقارات #недвижимость #Fastigheter #Mäklare #ForSaleMarbella@SpainForSale.Properties
    @SpainForSale.Properties #Marbella #Costadelsol #PuertoBanus #LuxuryVillaForsaleinMarbella #VillaForSaleMarbella #Holidays #SeaViewsPenthouseForsaleinMarbella #PlotForSaleinMarbella #CostadelGolf.

    ReplyDelete
  2. This is awesome post.Thank you so much have been sharingyour lovely information.People are benifits it is
    low gpa and pt school

    ReplyDelete
  3. This is actually the kind of information I have been trying to find. Thank you for writing this information. www.mykioskey.com

    ReplyDelete