In the five years prior to the Covid-19 crisis, Oregon’s commercial real estate market was going from strength to strength after a long period of stagnation.
In the first few months of 2020, the value of office sales in the region was closing in on the $1 billion mark. Now, of course, the market has slowed significantly and business owners are hesitant about almost any aspect of leasing or expanding.
In these uncertain times, it’s vitally important for preparations to be made. Whether any recovery period begins sooner or later, commercial real estate in Oregon needs to hit the ground running if its key players wish to see figures eventually return to pre-Covid levels.
One hugely successful real estate market that can be used for inspiration when planning a comeback is that of London, England. The European capital has seen huge successes in both the residential and commercial property industries. In fact, it has one of the largest markets of this kind in the world.
Crashes and recessions have had a far smaller impact here than in other territories, thanks to the strength of the investment landscape and the never-ending demand for business-related property.
So, what can Oregon learn from London when it comes to commercial real estate?
1. Key players
With global giants such as Apple, Facebook, Deutsche Bank, IBM, Amazon, J.P. Morgan and many more besides choosing to retain bases in London, both the value of and demand for commercial property remains high.
Business owners will always choose to locate their firms in the same districts as major players of this kind, as doing so provides an air of success. The more a region can attract the high flyers, the more lucrative real estate deals will be made there.
2. Transport links
London has its world-famous red buses, tube network and black cabs as well as many other facilities. While the significant availability of public transport in the capital is partly the result of the high number of businesses located there, it also plays a major part in the number of new businesses choosing to create a base in the area.
Companies need offices that are easy to get to, which is why in order to see success within its real estate sector, a region needs to focus on its transport links, creating commercial hubs at the points where that transport is easiest to come by.
3. Specialist districts
One of the most notable aspects of London’s real estate landscape is that different industries tend to stick to different “boroughs”.
Canary Wharf is home to major banks, media outlets and law firms. Financiers and insurance brokers are more likely to be found in the City of London – a more central district.
Government-related businesses tend to be located in Westminster along with large real estate firms, while Camden and Islington are creative hubs, brimming with fashion houses, design firms and architects’ offices.
Keeping each area along a particular “theme” can be very handy. The forging of connections between companies within the same industry is made easier as a result – and resources and facilities can be purpose-built to meet each district’s unique needs.
4. Commercial property trends
Thanks to high levels of investment, the commercial property market in London is easily able to keep up with up and coming trends.
For example, the global demand for flexible office space was growing exponentially even before the current crisis. Now that many businesses have found it necessary to arrange for home or remote working in response to Covid-19, this type of arrangement is likely to become more popular than ever.
Serviced offices with features such as gyms, bars, games rooms and specially equipped breakout spaces have been hugely popular in recent years too, and are also likely to attract successful up-and-coming companies.
With this in mind, Oregon real estate leaders should consider taking a leaf out of London’s book and investing in the development of property that follows major current trends.
5. Overseas investment
One of the key reasons behind London’s success is the prevalence of overseas investment. It is likely that there will be changes to this situation in coming years – depending on the finer points of Brexit and possible upcoming changes to taxes levied on non-UK residents.
However, attracting affluent foreign investors can make a huge difference to a region’s property landscape.
It’s a bit of a catch-22, though; an area’s real estate market needs to be successful – or at least show significant potential – in order to attract investors. However, one of the key ways to show the success of a real estate market and reveal its potential for growth is to be able to demonstrate the current existence of high-end investors.
The above five points detail strengths of London’s commercial real estate industry that could be cultivated within Oregon to promote success.
For further information about the UK market as a whole or for an informal chat, get in touch with the residential and commercial real estate specialists at Property Solvers today.
