Thanks to data from online search engines, we’re able to see what commercial property investors are looking for in 2021 compared to the same period last year.
We live in the Information Age. Data is constantly flying past our eyes and ears, and while sometimes the abundance of commercial real estate info can be distracting, it can really highlight major trends in the property market which are difficult to otherwise see. And the data we have on investors’ online search trends has shown us what commercial property investors are looking for in these final months of 2021.
But how do we get this info?
Every time you enter a search query into Google, that keyword or phrase is recorded. The total number of these monthly search queries entered by you or anybody else on the internet is tallied up and recorded as what’s called ‘search volume’.
So, we can see the buyer and leasing appetites in the commercial property industry using the search volume for particular keywords and phrases as our north star, and even compare the search volumes month-on-month and year-on-year.
Let’s take a look at the data.
Buyers are back post-COVID
As far commercial transactions go, you could’ve heard a penny drop in 2020. Investors sat on the sidelines while landlords held on tight to their assets, in search of some certainty in the face of the pandemic before considering divesting their commercial assets.
Those investors are back in the game.
March 2021 registered an 86-per cent year-on-year increase in ‘buyer searches’ – keywords entered into search engines pertaining to buying a commercial asset – and we’ve seen at least a 25-per cent annual increase in the months that followed.
Office the most searched asset class for buyers
Demand for office space has seen the highest increase since last year. Search volumes for the ‘office property investment‘ category have increased 90 per cent in August 2021 compared to the same time last year. Medical assets follow closely with a 73-per cent annual increase.
Warehouses have seen a far lower increase in search volume, either showing a cooling of buyer interest or an investor realisation that the boat to own high-quality industrial real estate at a modest price has left the dock. It will be interesting to see if this trend continues into the new year.
Many of the buyers have their eyes on South Australia, with listing views for South Australian office investment rising 74 per cent in August 2021 compared to July 2021. August listing views for Queensland office investment is 56 per cent higher month-on-month, while NSW and Victoria registered 13 per cent and 31 per cent respective increases.
These search trends for office investment are not surprising, given the resilience of the asset class (almost $10 billion of office transactions have been recorded so far in 2021).
Industrial tenants hunt for occupancy in late-2021
Across Australia, Warehouses and showrooms have recorded the highest annual increase in listing views in August 2021, both seeing a 40 per cent change since 2020.
The change in month-on-month ‘for lease’ listing views, while negative for all asset classes, tells a similar story. The August listing views for warehouse and showrooms have decreased only 7 per cent and 8 per cent respectively, while larger decreases were recorded for land/development (-14 per cent), hotels (-12 per cent), medical (-11 per cent), and retail (-11 per cent).
It’d be great if we could determine the ideal acquisition using just this information. But we can’t rely on data alone.
Savvy investors will leave their computers to gauge the temperature of the market, by talking with the relevant experts (leasing agents, valuers, bankers) and getting under the roof of prospective acquisitions.
Don’t have the time?
Why not consider investing alongside a commercial property syndicate?
Properties & Pathways is a dynamic commercial property investment company. Our completed syndicates have provided investors an average annualised return of 19%. For more information on how you can invest alongside us, get in touch today.
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