Southern Cities Primed for Commercial Real Estate Investment

Investors are looking to fund key growth areas

Despite the economic turmoil dominating the headlines – high interest rates, an impending recession, and banks collapsing – the financial experts at Loan Mantra have found that commercial real estate investment opportunities are (CRE) still expanding in many southern cities.

Top Southern Cities for Commercial Real Estate Investments

Topping the commercial real estate markets for 2023 include Raleigh-Durham, Charlotte, Nashville, Dallas-Ft. Worth, Atlanta, Tampa, and Austin. Additionally, Charleston’s robust commercial real estate market is poised for growth in 2023 and beyond for individual investors and real estate investment trusts.

“Exciting things are happening to commercial real estate, especially in the south. In Charleston, we’re seeing dramatic growth in warehouse and distribution centers, as we shift to more e-commerce shopping models in our post-pandemic world. This behavioral pivot is driving considerable investment and consistent returns in the city’s commercial real estate development,” said Raj Tulshan, founder of Loan Mantra. “Our company currently has investors looking for commercial opportunities in the $5M-$10M range.”

Though once an area with less competition, Raleigh-Durham’s demand for office space is steadily increasing. The area boasts a combination of research universities, an affordable way of life, culture, charm, and major growth from companies such as Fidelity Investments, Apple, and Google. Charlotte, one of the top 20 fastest-growing U.S. cities is also a huge banking and industrial hub, with a low cost of living and access to both beaches and cities. These areas are all attractive to investors who are shifting their operational headquarters after the pandemic, and seeking to move to areas that can provide these types of amenities and cost-to-value.

Tips for Commercial Real Estate Investment

While the economy and stock market has been tumultuous for the past few years, commercial real estate can be a wise investment. Take advantage of southern hospitality and build your portolio in these ways:

Do your research

Determine where commercial real estate is worth the opportunity. Which markets – like Raleigh-Durham or Charleston–are seeing an influx of businesses? Which cities have solid “anchors” – including universities, large industries, and/or major corporations that will continue to draw people to the area? Also consider other factors that are likely to attract growth, including a low cost of living, pleasant weather, low crime rates, superior school districts, etc.

Look at growth projections

Which cities are building out infrastructure, such as retail and restaurant space? Which markets are adding new homes and apartment buildings? Where are new offices and parking structures being added? For the past several years, North Carolina has continued to grow its residents by a marked percent. In 2022, it trailed only behind Texas and Florida as the quickest growing state. Most attribute the Tar Heel’s population growth to low cost of living, industry expansion, and opportunities. Conversely, consider where cities are losing space, facing declining populations, and experiencing decreased spending.

Determine where rent is increasing

Commercial real estate investors know it’s a smart financial decision to be their own landlord. In this (or any) economy, buying real estate can add to the long term value of your business.

Invest in technology

Investing in your technology is almost as important as the ground you purchase. Technology that automates processes and controls building operations (including HVAC, security features, etc.) have become essential in the industry. Investors that buy properties with efficient, streamlined, tech-driven processes will be better positioned to grow the business. Alternatively, owners who are thinking about capital improvements to their property should consider “smart” updates.

Prioritize ESG

Savvy commercial real estate investors prioritize environmental, social, and governance (ESG) efforts when purchasing, building, and operating their properties. For many funds, ESG is a non-negotiable.

Be flexible

Business has changed. E-commerce options with warehouse and distribution centers are replacing behemoth retail spaces. Many large companies that previously used huge office spaces have pivoted to hybrid work environments and need smaller, more flexible work spaces. Since the future of the office remains uncertain, many organizations prefer short-term, flexible CRE leasing options.

Work with a financial expert

If you’re considering a real estate investment and need to secure funding, work with experts who know the industry. Professionals should be able to discuss best loan options, CRE investment opportunities and customized advice based on your specific circumstances and needs.

About Loan Mantra

Loan Mantra is democratizing the loan process for all borrowers. With experience working with various commercial real estate investments, our experts are here to help you navigate your investment opportunities–whether it’s in the south or elsewhere. Reach out today at www.loanmantra.com.