Historically, commercial property is a powerful investment and relatively stable vehicle for preserving wealth. Property development is the purchase of property or land with the intention to add value by renovating, extending, or refurbishing the produce positive ROI. Commercial property development is valued at the potential income it can generate for the owner. The advantages of developing a property are cash flow, lower vacancy rates, available tenants, and higher income potential. The most attractive developments are apartment complexes, student housing, office buildings and storage facilities.

Pros

1. High Return on Investment- Property development has a great potential to generate significant ROI.
2. Often Shorter Length of Investment–  Speed of sales is the goal as it generates the highest profit and annualized return.
3. Stability-Property investment have proven to be the most stable when compared to other options. Even through ups and downs the property market is less volatile than other markets.
4. Leverage- Purchase more with less by utilizing mortgage/lending. This leverage allows investors to maximize ROI when experiencing growth.

Land Development Trends 2022

• Capital and available debt-will contribute to another year of growth
• Growth amongst multiple sectors-drives price appreciation to past pre pandemic levels. Multi family is expected to lead when it comes to commercial development.
• Secondary market– will outgrow major cities.

Multifamily outperformed in 2021 and will likely continue in 2022.