October 29, 2024
How Secondary Markets Are Influencing the Demand for Office and Multifamily Spaces
As the commercial real estate (CRE) sector adapts to current trends, secondary markets are emerging as ideal areas for growth. Rising costs in major urban centers, combined with evolving lifestyle preferences, are prompting businesses and residents to explore these promising regions. Cities like Raleigh, Charlotte, and Nashville are quickly becoming hotspots for development in office and multifamily spaces, driven by affordability, infrastructure advancements, and an increasing focus on quality of life.
Several factors contribute to the growing popularity of secondary markets:
Cost Efficiency: Escalating expenses in primary cities are leading companies and individuals to seek budget-friendly alternatives. Secondary markets offer lower operational costs while providing desirable amenities. This makes communities in secondary markets more appealing for businesses looking to maximize budgets without compromising on quality.
New Work Patterns: The rise of remote and hybrid work models has lessened the need for companies to establish themselves in expensive, densely populated areas. This shift allows for flexible office arrangements in secondary cities, where employees can achieve a better work-life balance and increased productivity at a reduced cost.
Quality of Life: Many secondary markets are investing in infrastructure, enhancing their competitiveness. Improvements in quality of life—such as reduced congestion and increased access to green spaces—make these locations attractive not just for businesses but also for employees and residents, increasing interest in multifamily housing.
With a rising number of individuals and businesses relocating to secondary markets, the need for multifamily housing is also increasing. These areas attract residents seeking urban-like amenities without the high costs associated with larger metropolitan areas.
Armada Hoffler is dedicated to understanding and responding to the needs of the communities we serve. We design properties that emphasize community living, walkability, and sustainability, creating environments where residents can thrive. This approach enhances quality of life while keeping our developments economically sound for our investors.
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