By Jonathan Glick, Sheldon Gross Realty

Most of the clients Sheldon Gross Realty represented during 2023 – along with the majority of transactions we completed – were tied to the selling or leasing either of office space or industrial properties. These were owned primarily by private companies and investors, all with strong entrepreneurial inclinations.

I anticipate that during 2024 we’ll see something of a return to a pre-Covid style of business.

Will it be 2019 all over again? Definitely not – but with the pandemic slipping further into the past, the marketplace will manifest a significantly more traditional look. With office space, we’re in a period of trial and error in terms of how properties are utilized, both related to scheduling and redesign. Businesses want employees to be on-site more often than during the past several years, while workers are focused on comfort, collaboration, and socialization. On the industrial side, the focus during 2024 will largely be on inventories – with a specific emphasis on them returning consistently to whatever sizes companies deem appropriate.

The overall office market will continue to struggle during 2024, with the supply of vacant, available space far outstripping demand. That said, office property tenants and investors will be able to find outstanding opportunities … assuming they’re willing to look hard, without rushing the process. One continuing trend will be the repurposing of large office parks and obsolete, multi-story general office buildings.

Speaking of vacancies, the volume within the industrial sector is continuing the steady climb that’s been ongoing for about the past four quarters. But interestingly, the price for industrial properties is so far holding fast, and we’ve yet to see signs of decline. It’s an unusual situation, and one that bears careful watching.

Overall, those in the office sector will be able to find value-added deals … with the caveat being that patience will be essential. The deals will be out there, but it will take a bit of time to track them down. On the industrial side, the inventory will steadily increase, so tenants will have access to lower rents and investors will see higher cap rates. Again, the watchword will be patience.

Jonathan Glick is executive vice president at Sheldon Gross Realty.