Where Are The Lowest-Risk Cities To Invest In Commercial Real Estate in 2023?

The commercial real estate market can be a risky and unstable sector of the economy when certain conditions are present. However, investors can select places that are more likely to offer low-risk investments with the correct research and information.

There are many factors that determine `risk.` Most cannot be accounted for, but likewise are extremely low-probability, though not as low as standard statistical analysis might lead you to believe. In general, the likelihood of loss increases as conditions upon which prior investments were predicated deteriorate.

This could mean low interest rates, abundant capital, a fixed physical office location, or the advent of e-commerce technologies that beget the need for more warehousing.

The five cities with what we believe are the lowest investment risks for commercial real estate in 2023 are examined below.

5. Atlanta, Georgia:

Over the past ten years, investments in commercial real estate have steadily increased in this thriving metropolis. It is a desirable market for investors due to its strong economy and diversified economic sectors. Additionally, because of its rapid population growth and low unemployment rate, price declines and vacant spaces are improbable. Low crime rates, relatively low cost of living and a growing job market make Atlanta a viable candidate despite its larger-than-the-group population size.

4. Austin, Texas:

Austin is another excellent location to invest in commercial real estate. Many tech companies are based in this thriving metropolis, which has seen rapid expansion thanks to the influx of educated professionals. Additionally, it has a strong job market and a growing number of non-tech firms, which appeals to investors. Austin`s attractiveness oozes through its population and climate, as well; over 300 days of sunshine per year on average give the city a decided outdoor flavor, and a vibrant culture and entertainment scene.

3. Dallas, Texas:

Dallas has traditionally been a well-liked location for investing in commercial real estate. Investors find it to be a desirable alternative due to its robust job market, inexpensive cost of living, and thriving economy. Additionally, its robust economic forecast and population expansion make it a low-risk choice for investors. Dallas is also part of the larger DFW Metroplex, which gives it an enormous advantage in addition to its geographical location close to the center of the country, in terms of cost and logistics.

2. Minneapolis, Minnesota:

Minneapolis is a fantastic place to invest in commercial real estate. It is a desirable alternative for both businesses and investors because of its robust economy, low cost of living - reflected in the lowest average rents in the group at $28.65/ft, and high standard of living. Additionally, it is a low-risk choice for investors due to its low vacancy rate and consistent population expansion.

1. Denver, CO:

Denver is our top city to invest in commercial real estate, for a host of reasons. The technology and healthcare sectors are the two main drivers of Denver`s robust local economy, which serves as a reliable source of stable economic growth. The city also has a very low unemployment rate, a highly educated populace, and a surge of young professionals drawn to the dynamic culture of the area. The city`s economy and overall stability make it a low-risk location to invest in commercial real estate. Additionally, Denver is a desirable location for firms wishing to expand due to its cheaper cost of living than the national average. The city also offers a variety of transit choices, making it a great place for companies that want to be nearer to their clients. Obviously, there are the in-dismissable draws of lots of sunshine and mountain activities, in addition, which tip the scales squarely in Denver`s favor.

For investors looking to buy commercial real estate in 2023, these five cities represent excellent choices. Every city has a set of distinctive benefits that draw investors to it, while lacking key risk factors such as a cumbersome tax structure, or a declining population. Investors can find places that are more likely to offer low-risk investments and benefit from a profitable commercial real estate business by conducting the necessary research and learning.