Realtors report commercial real estate markets continue to improve nationwide. Both gross income and sales volume have increased in the past year, according to National Association of Realtors "2017 Commercial Member Profile."
"There has been an uptick in Realtor members who choose to specialize in commercial real estate at the same time as commercial professionals report improvements in the market and their business activity," said William E. Brown, president of the national Realtor group. "A stronger commercial market is a good indicator of a growing economy, so the outlook is positive for commercial members in the year ahead."
The study of the commercial market found while the number of transactions decreased slightly in 2016, the sales volume increased again. The median sales transaction volume in 2016 among members who had a transaction was $3,500,000, an increase from $2,931,000 in 2015. Only 7 percent of commercial members reported not having a transaction at all, which decreased from 8 percent in 2015.
According to NAR, one-fifth of surveyed Realtors practicing in commercial real estate closed a sale with an international client in 2016. China was the top country of origin in both buying and selling commercial real estate in 2016. As foreign investors flock to smaller-sized commercial properties in secondary and tertiary markets, many Realtors are confident that increased sales and leasing activity will occur in 2017.
"Nowhere is commercial real estate market expansion more evident than here in Silicon Valley. We're seeing a lot of expansion by the big tech companies, smaller companies and foreign investors, as well," remarked Denise Welsh, president of the Silicon Valley Association of Realtors.
Welsh points to the ongoing efforts of tech giants Apple, Google and Facebook to expand their footprint in the region. Along with Apple's corporate headquarters and newly built campus in Cupertino, the company is retaining offices it has leased all around the city.
Google is no longer just in its Mountain View headquarters. The company has bought real estate all along the Peninsula, from San Francisco down to Sunnyvale, and most recently announced its plans to expand into downtown San Jose.
Facebook, like Google, is getting into the business of housing development with its plan for massive expansion in Menlo Park at Willow Road and Bayfront Expressway. The company has submitted plans to build its "Willow Campus," which would have 3.45 million square feet of office, residential, and retail space on 59 acres of property.
"Companies continue to expand locally and we cannot continue to keep up with the demand for housing. Denser housing isn't the only answer," said Welsh. "An alternative could be mass transit from outlying areas. It exists in other parts of the country. We cannot continually dwell on the problem. We need to seek a solution."
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
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