Patrick Jankowski, Economist for the Greater Houston Partnership, shared that 2021 and 2022 were record “sprinting” years where job numbers were soaring and spending was at an all time high. 2024 is forecasted to be more of a “marathon” year where we see more stability and a normal reset.
A large focus for investors and owners continues to be on interest rates. Elevated interest rates have the potential to impact pricing and market dynamics by limiting excessive demand. This, in turn, can hinder property prices from reaching unaffordable levels for most investors. The Fed desires to cap inflation at no more than 2% throughout 2024, but is uncertain on how interest rates and transaction activity will be impacted. Although often seen as unfavorable initially, high interest rates can act as a protective measure against market unpredictability and excesses, contributing to a more stable environment for investors in commercial real estate.
Rising costs are also seen as a projected problem for 2024 with the Fed unwilling to decrease interest rates. We continue to see an impact on the cost of construction materials and labor. Furthermore, higher insurance premiums and payouts are being seen across the market due to natural disasters taking place more often. However, with treasury services at the owner’s and operator’s disposal, they can streamline the payables and receivables processes by increasing rent and decreasing operating expenses.
While challenges lie ahead, 2024 presents numerous opportunities for commercial real estate investors and owners. They can enhance their cash optimization, leverage technology for a competitive edge, and incorporate energy-efficient upgrades. In essence, investors and owners must be prepared to seize these opportunities promptly.
SETTING GOALS THAT MATTER
Every year as our ICO Team prepares for the New Year we meet together to collectively discuss the importance of goals and goal setting. As we met, we watched a video together called “SETTING GOALS THAT MATTER by Samantha Kris - https://www.youtube.com/watch?v=lkqOZgVLC88
Our team really enjoyed the unique, effective, and fresh approach to goal setting that Samantha Kris calls the “REAL Goal Methodology”. Her “Real Goal Methodology” emphasizes the importance of personal Resonance, Empowerment, Actionability, and personal gain in goal setting (Lucrative).
Our team found this goal setting perspective to be a refreshing departure from traditional goal-setting methods that typically focus mostly on measurable outcomes. This approach offers a great framework for setting and achieving goals that get us aligned with our true desires and that also challenges us to put our feelings at the core of our goals.
We look forward to implementing this approach to our goal planning in 2024 and thought that you might find this strategy helpful and insightful too.
