The Commercial Real Estate Trends & Outlook Report discusses trends in the small commercial market or transactions that are typically less than $2.5 million. This report is based on information collected from NAR’s 2020 Q3 Commercial Real Estate Quarterly Market Survey about the commercial transactions of REALTORS® and members of NAR’ commercial affiliate organizations (CCIM, SIOR, RLI, IREM, and the Counselors of Real Estate) during the third quarter of 2020.
The survey results indicate the continuing impact of the pandemic on the volume of transactions and on commercial business practices. The impact of the pandemic is still evolving but the survey results are providing an indication of where changes are heading. In the office sector, 62% of respondents reported an increase in companies moving to smaller offices, and 58% of respondents reported an increase in short-term leases of two years or less. In the retail properties market, 52% percent reported they are seeing more vacant malls being repurposed for other uses, such as mixed-use, industrial use, hospitals, or as churches.
REALTORS® reported a decline in sales and leasing transactions, except for industrial properties, clearly the strongest leg of the commercial sector. The land market has also been a strong sector, especially sales of land for recreational use, as the pandemic has curtailed leisure activities in the urban areas.