Technology and the internet is driving force for both retail and office growth in real estate investing

This is a totally different commercial real estate market. The market is very different for many reasons. While many commercial investors are attempting to recover from the Great Recession with strategies they've been successful with before, now is a time to assess what is happening in the markets. We are seeing that apartment investing has been successful and new units are starting to be built. However, you're not seeing growth in retail or office space. The reason is not the slow growth of the economy. The reason is technology and cultural change. The big national retailers are financially healthy with plenty of cash on hand. In days of the past, they would use the cash to finance expansion into new markets. Previously, expansion was into suburbia. New retail would pop up wherever new large subdivisions were built. Today, new subdivisions are not being built. Suburbia is mostly the creation of the baby boomers that are now entering their retirement years. The younger generations are choosing to live in urban centers - apartments. The question becomes will they stay there? The younger generation is also delaying parenthood later into life. Schooling children was one of the drivers behind suburbia. Inner city schools are notoriously bad at delivering a quality education. As the younger generation become parents, will they return to suburbia for a better education? More than likely not. They have two other choices. One is forcing the inner city education system to improve. The other is that because they are having children later, they are better off financially when they do. They are going to have the option of providing their children with a private education. What it comes down to is cultural change. Growth in the suburbs is not likely to occur. Redeveloping brown field properties in select urban settings looks to be the way of the future.  Retail is still waiting to see how brick and mortar stores are going to standup to internet sales. This could lead to more growth in warehouse processing of sales and less storefronts. For office space, reality is already here. We all know more and more people are working from home. As gasoline prices remain high and the internet makes this easier, the trend will only continue in the future. U.S. Census data show that in the 1970s, companies allotted about 600 square feet of space per employee. Today that number is less than 200 square feet. Neither brick and mortar retail nor office space are going to see any appreciable growth in the near term. That doesn't mean commercial real estate isn't a good investment. Just compare the return on capital with an investment in treasuries or any other financial product. The secret to investing in commercial today is knowing where and what to invest in.