Holiday Closure

The OREA office will close for the holidays at 12 p.m. Tuesday, December 24th.  Normal business hours will resume on Thursday, January 2nd.  Happy Holidays!

Holiday Closure

The OREA office will close for the holidays at 12 p.m. Tuesday, December 24th.  Normal business hours will resume on Thursday, January 2nd.  Happy Holidays!

March 4th - 2005

What does the future hold for commercial real estate?

Will telecommuting, e-tailing and outsourcing mean the end of office and retail space as we know it?

Will telecommuting, e-tailing and outsourcing mean the end of office and retail space as we know it?

In his NAIOP (National Association of Industrial and Office Properties) Research Foundation Report, futurist David Pearce Snyder writes that industrial enterprise will need to re-invent itself for the information age. The report cites examples of several companies who have cut their rental space and real estate requirements, a substantial increase in online shopping and outsourcing of traditionally in-house corporate services as having an impact on industrial and commercial real estate.

Hewlett Packard cut its real estate holdings in Silicon Valley by 19% in part by turning 450 of its employees into teleworkers and Sun Micro Systems cut half a million square feet from its Santa Clara operations over the past two years…cutting its annual real estate bill by $71 million. E-tailing or online retail sales are projected to top $100 billion for the first time in 2004 and outsourcing is a new reality for corporate functions like human resources management and information systems in America where only 30% of business property is owner-occupied.”

So where will business come from for commercial REALTORS in the next decade? Snyder’s report talks about the key growth areas where there will be a demand for industrial or office space including medicine and health care, education and government and non-profit organizations. He also states a projected population growth will result in a great demand for residential and workspace in American cities. “Because urbanized areas are already largely built-out, cities’ ability to compete for this new growth will depend on its property owners and developers capacities to recycle existing structures and neighbourhoods for new occupants. Some of the predictions for how cities in the U.S. and Canada will ‘recycle’ this space include the following:

  • A projected 50% growth in urban transit systems in the U.S. and Canada – mostly light rail – will expand opportunities for mixed-use “transit villages” to revitalize central cities and older suburbs
  • Many under-performing shopping malls will be redeveloped as upscale “lifestyle centers,” incorporating residential and commercial space
  • New tax and mortgage subsidies adopted to ease the mounting shortage of affordable housing can be expected to accelerate the conversion of industrial, warehouse and office properties into residential and mixed-use developments
  • The adoption of modular “open building” systems for residential space (PATH) will greatly facilitate the conversion of office space to affordable residential space
  • Empty urban buildings of all kinds will be in increasing demand to house a variety of transitional uses, including parking, storage lockers and info-structure: secure data switching, and storage facilities and information utility processing centers
  • The exteriors of tall buildings will offer lucrative opportunities for animated advertising using low-cost e-paper and e-ink displays plus programmable high-tech super-graphics made possible by covering structures with energy-efficient LEDs.

View the survey at www.naiop.org/services/fcurrent.cfm. 

Where the opportunities are
The NAIOP study identifies the industries that will have the largest job growth to 2012, needing workers and space to put them. The top ten are:

  1. Education
  2. Retail trade
  3. Ambulatory care
  4. Professional, Technical and Scientific services
  5. Employment services
  6. Eating and drinking establishments
  7. Construction
  8. Finance, insurance, banking
  9. Nursing and residential care
  10. Transportation and warehousing.

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Ontario Real Estate Association

Jean-Adrien Delicano

Senior Manager, Media Relations

JeanAdrienD@orea.com

416-445-9910 ext. 246

Ontario Real Estate Association
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