The pandemic has encouraged work-from-home situations that have led some companies to downsize spaces, but Susan Goldstein says offices will continue to be important for company culture and creativity.
Company: Susan Goldstein has facilitated transactions across Sarasota and Manatee counties for more than 15 years, totaling over $100 million. In the Sarasota area, an influx of new residents moving from other parts of the country is driving some commercial real estate activity. “Fundamentally the economics are those new residents need new services that are filled by commercial real estate,” says Goldstein. “Our market dynamics are very different than the global market. The strong residential market is the basis of our strong commercial market.”
Opportunities: While clearly more people than ever before are working from home, Goldstein sees opportunities in the office market. “I think any kind of change breeds opportunity for investors and business owners,” she says. “I think the biggest struggle will be to have realistic expectations on both sides. There are potential buyers that believe they can find steals. I don’t see a lot of steals out there. And then owners — sellers of properties — need to look at where the market is, where we believe it’s going and price appropriately and respond as we determine where the market is.”
The pandemic has encouraged work-from-home situations that have led some companies to downsize spaces, but Goldstein says offices will continue to be important for company culture and creativity. Some businesses might also need more square footage for social distancing. “There are businesses that are going to expand, and there are businesses that are going to shrink their footprint,” she says.
Beyond the office market, Goldstein sees continued opportunities ahead in industrial space. “Certainly the industrial market has been hot and will continue to be hot,” she says. “The result of the pandemic is in part that many businesses are trying to move their operations or supply chains local or at least to the U.S., and that is creating a high demand for industrial product.”
Threats: The retail sector has been impacted by the pandemic in a big way, with storefront vacancies and bankruptcies dotting the landscape, both locally and nationally. To wit: real estate data firm CoStar Group reports that the 40 major retailers that filed for Chapter 11 bankruptcy protection and the 11,157 stores that closed this year both set new annual records.
On the flip side, Goldstein believes the strong residential development in the area will continue to support pockets of retail. As one example of retail real estate strength, Goldstein points to a transaction in the St. Armands Circle submarket in Sarasota. Retail vacancies remain on the Circle, but it was also the site of a record-breaking sale this year when Limestone Asset Management and Orion Real Estate Group purchased a pair of retail shops for $15.5 million. At $1,712 per square foot, it set a record in the shopping district for price per square foot, according to a Business Observer analysis.
In general, while 2020 has been a year of upheaval, Goldstein predicts a different kind of year ahead. “I see a calmness coming on the market with the end of the election and the availability of these vaccines,” she says. For business owners, that could be a sense of relief. “Now they need to really drill down even more and figure out where they want to go and how real estate will be a part of that,” says Goldstein. “I’m very optimistic about 2021.”